Excluded Eligible Employees: return of employer matching contributions?

[Guest BL333]

As the result of an administrative error, elective deferrals were taken and matching contributions made for an employee who had opted out of the plan. I assume this is not a mistake of fact and that the error must be corrected under EPCRS. The plan will refund the elective deferral amount. May the plan refund the employer matching contribution? Any help would be appreciated!

[J Simmons]

Could the match remain in the plan and be re-applied to the fixed match to elective deferrals of another employee? The employer yet gets the benefit, and you do not then need to deal with mistake of fact hurdles to get a refund.

[MWeddell]

The goal is to put the plan and the participant in the position they would have been in but for the operational error. Refunding the match to the employee does not advance that goal. It should be forfeited and used to fund future employer contributions.