Odd Plan Year Entry Dates

[Tinman]

Plan is an off-calendar year of 5/7 - 5/6. Entry dates are defined as "Semi-annual. The first day of the 1st month and the 7th month of the Plan Year" There is nothing specific to semi-annual entry dates in the BPD.

My question - would you take this definition to mean that entry dates are actually 5/1 and 11/1? The 11/1 date I'm ok with - but the 5/1 date would be in the prior plan year so I don't get how that would work.

Example: Plan year 5/7/2009 thru 5/6/2010

First Entry date: 5/1/2009???

Opinions, please!

[Mike Preston]

You need a conference call with two parties: 1) the person responsible for drafting the plan; 2) an ERISA lawyer.

I could be wrong, but I do not sense a happy ending.

[Guest Sieve]

You cannot keep an employee out of the plan past the earlier of (i) the first day of the next plan year, or (ii) 6 months after meeting 1 y/s & age 21 (assuming you use the maximum eligibility standards). Does the plan use the maximum age/service eligibility requirements? If so, the 5/1 & 11/1 entry dates will not permit someone hired on May 3 to enter the plan on the first day of the plan year, as required. It really is only a problem for those hired May 2 through May 7, because they ought to commence participation no later than the 5/7 after meeting age/service, but they won't participate until 11/1. All others simply will get into the plan a bit earlier than required by law.

If the plan doesn't use 1 y/s, but uses something less than that, then these entry dates might be ok (depending on the eligibility period and the age, if any, used)--think 1/2 y/s, age 20-1/2, single entry date of 1st day of plan year is ok.

[david rigby]

You may be able to address this confusion by amending the plan to offer a slightly more generous entry provision.

[WDIK]

Does a "Plan Month" start on the 7th day or the 1st day of the calendar month? This goes back to Mr. Preston's point.

[GMK]

WDIK makes the relevant point.

For a 5/7 - 5/6 plan year, I would read that "the first day of the first month of the plan year" is 5/7, unless the word "calendar" shows up by the words "day" or "month."

[John Feldt ERPA CPC QPA]

And the plan document probably provides for the Plan Administrator (PA) to make interpretations regarding the terms of the document.

So if the word "calendar" is not connected to the word "month", then it seems to follow that the PA has the authority to interpret the plan month to start on the 7th, just like the "plan year" does.