Terminated Employees - Final Paycheck Decuctions?

[Guest jachapma]

Looking at a 403(b) plan where most participants elect to defer a static amount rather than a %. Is there any guidance on how to allocate the final paycheck to deferrals, insurance, etc.?

For example, employee A has elected to deduct $100 from each paycheck which includes $50 for 403(b) $10 for dental, and $40 for health. Employee A is terminated, and final paycheck is < $100. In what order are the contributions made?

Also, if it is a Plan Administrator's practice (though not in the Plan Document) to simply terminate 403(b) deferrals prior to the final paycheck, could the Plan Administrator be liable for the contribution that was not made (for the final paycheck)?

Thanks for your help, this website has been immensely helpful.

[J Simmons]

From my time as an in-house benefits manager, we gave preference to the insurance deductions (here, health and dental) over retirement savings. If we were wrong, I'd rather have to pay the $50 to correct the retirement contribution having not been made than having to pay for a $50,000 surgery that went uncovered because we allocated the deductions elsewhere first.