Jpagano

The union plan that has been established is not sponsored by the client. Does this change the ability to process a plan to plan transfer assuming each party amends as required?

Hi. We have a client who has a group of employees that are now under a union contract. They are still employed by our client. New contributions are being sent to the union plan which is administered by another vendor. The broker has requested that we amend the plan they have with us to exclude this group of employees from being eligible to participate in the plan and transfer these assets to the union plan. There are fringe wages and deferrals in this plan - don't know if this matters, but wanted to mention it. Our base document states: 3.4 TERMINATION OF ELIGIBILITY In the event a Participant shall go from a classification of an Eligible Employee to an ineligible Employee, such Participant shall continue to vest in the Plan for each Year of Service (or Period of Service, if the elapsed time method is used) completed while an ineligible Employee, until such time as the Participant's Account is forfeited or distributed pursuant to the terms of the Plan. Additionally, the Participant's interest in the Plan shall continue to share in the earnings of the Trust Fund in the same manner as Participants We are not convinced that changing the eligibility status of the participant population, while still remaining employees of the same company, permits a plan to plan transfer. Our attorney agrees but we're getting push back. The broker has stated that one of his colleagues had this exact situation and that's what his client did. Is there any code that anyone can direct me to that would help us resolve this? Thanks! Jen