Multiple Employer Plan

[KateSmithPA]

I have truly tried to find an answer to my question by searching the boards, but after reviewing post after post, I have not come upon this question. I have, however, learned some very scary things about Multiple Employer Plans and SEC rules.

We are TPA for an MEP. An eligible participant moved from one employer to another employer, within the MEP, mid year. She had 834 hours with one employer and 1400 with the other. I know that her hours are combined for vesting purposes. However, if the allocation formula requires 1000 hours and employment on the last day I believe she would not be eligible for an allocation from the first company because she only worked 834 hours and was not there on the last day.

Would someone be kind enough to confirm or refute this?

Thank you.

[Guest Sieve]

Since the regs under IRC Section 413 consider IRC Section 411 and its regulations to be applied as if all emloyers in a multiple employer plan are a single employer (Treas. Reg. Section 1.413-2(d)), and since IRC Section 411 deals with accrued benefits (in addition to vesting), then I would think that all hours and all service counts for benefit accrual purposes. Because separate employers in an MEP may have different contribution and allocation formulas, then why wouldn't this individual (who completed, in the aggregate, 2,234 h/s and was employed on the last day of the year by the plans's "single employer") receive an allocation from each separate employer based on the compensation earned from that employer, like in a co-employer situation?

By the way, are there any Plan provisions that would cover this situation? Corbel's VS prototype, for example, has an entire Article covering multiple employer plans.