Employee term date a day before entry date & benefit entitlement

[flosfur]

Looking for consus.

A calendar year plan requires age 21 & 1 YOS for participation. Entry dates are 1/1 & 7/1 coincident/following the date the eligibility is met.

An employee hired on 1/1/02 who terminates on 12/31/02 obviously will have no benefit under the plan.

What about an employee hired on 7/1/02 who terminates on 06/30/03 and who has 1000 hrs credits for 2002 & 2003? I say, he does not accrue a benefit.

[MGB]

You need to provide a lot more detail on the plan provisions.

Is one year of service provided for 1000 hours?

When is this determined? I.e., if the measurement period may be any calendar year, then the person has one year on 12/31/02 and is a participant. However, if it is measured over the year beginning on the date of hire in the first year, they are not a participant until 7/1 (but never became one due to termination).

[Blinky the 3-eyed Fish]

I am not sure what consus is nor why you are looking for it.

Anyway, with DB and DC alike, you can't earn a benefit/get an allocation if you never entered the plan. So, did this person enter the plan? If your document is like most, where the employee does not meet the YOS requirement until the first 12 months are up (no matter when the 1,000 hours is completed), then this employee isn't employed on the entry date of 7/1/03 and never enters the plan.

[david rigby]

Ditto. What does the plan say about becoming a participant?

If you discover that this person did beocme a participant, watch out for vesting under top heavy rules.

[flosfur]

Ditto.  what does the plan say about becoming a participant?

If you discover that this person did beocme a participant, watch out for vesting under top heavy rules.

As stated in my post, an employee enters 1/1 & 7/1 coincident with or following eligibility is met.

Which part of the TH vesting rules? Are you referring to the participant having 2 yrs of service for vesting?

[flosfur]

I am not sure what consus is nor why you are looking for it.

.....

I know it was a non-question but someone had raised the question and before I emphatically say "no" I wanted to check out for the "just in case" .....

[MGB]

You still haven't stated the critical issue from the plan document. The 7/1, 1/1 dates don't answer this.

What is the measurement period for determining a year of service? Some use fixed years, some use the year beginning on the date of hire, others use a combination of the two, with the first year being from date of hire and then switching over (with a partial year of overlap) to a fixed year for later years. If yours uses fixed years (e.g., calendar year), they may have become a participant on 1/1 or on 7/1 for a different fixed year, such as a non-calendar plan year.

[Blinky the 3-eyed Fish]

MGB, your last post confused me. The first eligibility computation period must begin from date of hire. There was no mention of a re-hire situation here.

Now the plan though could credit the year of service once the participant meets the hours requirement (1,000 or whatever's in the doc), rather than when the hours requirement is met and the eligibility computation period has expired.

Flosfur, not to sound like a know-it-all, but you mean consensus. Consus is not a word. I was just making a joke to a perceived typing error.

[MGB]

Blinky,

You are stating minimum requirements under the law. Not all plans are written that way. Other structures are allowed that provide for a person to enter the plan earlier as long as the minimum is satisfied. So, using a measurement period of the calendar year that allows the person to enter on 1/1 is allowable because it is more liberal than the minimum requirement.

[Blinky the 3-eyed Fish]

Ah, I see your point, although I have never seen a document written that way (eligibility determinations are hard enough for clients without adding complexity).