Vesting

[Guest carsca]

A 401(k) plan has a five year graded vesting schedule and provides that a YOS is granted if the participant completes one hour of service.

Can the plan be amended to change the provision to 1000 hours?

(My concern is that 1.411(a)-8 applies.)

Any thoughts?

Thanks!

[MWeddell]

I believe that a change in the method of measuring vesting service is treated the same as a change in the vesting schedule itself:

- No participant's vested percentage may decrease, and

- A participant with 3 or more years of vesting service must be given the opportunity to stay on the old vesting schedule.

[actuarysmith]

I concur with MWedell.