Multiple Employer Groups

[Guest Jeff P]

I have a question concerning multiple employer plans. I am the recordkeeper for a group of companies with common ownership as follows:

Company A John Smith 100%

Company B John Smith 100%

Company C John Smith 70%,Jane Doe 25%

Company D John Smith 75%, John Jones 25%

Company A was the original client, and branched off last year into the other related businesses. For testing last plan year end, I grouped A and B together for 415, ACP & ADP, etc. and tested C separately. I was told by John Smith that D was not participating, so did not collect any information on them at all. For this plan year end (4/30) I am having renewed concerns about excluding Company D. Since C and D do not constitute a control group (<80% common ownership) is it OK for the companies to exclude D, or is there something I should be aware of?

I have noticed it is very hard to find specific information about the testing of multiple employer groups, especially when no union is involved (as is the case here) and when the pairing does not all constitute a control group.

[Guest Jeff P]

Sorry, my last line above should read:

Since C and D do not constitute a control group, is it ok to exclude D or is there something else I need to consider?

[Guest JimD]

The Journal of Pension Benefits has an Article in the Autumn 1995 issue regarding multiple employer plans. If the companies are not related(controlled group or affiliated service group) I do not think you have to be concerned about D.