No conditions on deferrals

[katieinny]

A not-for-profit employer has a provision in their 403(b) plan that says in order to get the 5% employer contribution, the employee must contribute 3%. If the employee contributes 2%, they don't get any employer contribution. I think I need to advise the employer that they must amend their plan to remove that provision, or at least modify it. Or can their current provision be interpreted as a permissible match?

[masteff]

Does the plan state a minimum contribution percentage? If not, the plan could state that 3% is the minimum. For example, our plan stated 3% to 50%.

[katieinny]

No, there's no mention of a minimum percentage. It simply says if the employee contributes 3% he or she will get a 5% contribution from the employer.