Union Sponsored 401k

[Guest MS TPA]

A local Union wants to sponsor a 401k for members/employees of 1 company. The company wants nothing to do with the 401k plan. Is this allowed?

[rcline46]

As described, no. The union does not employ the participants.

[Guest MS TPA]

What about when an instance when a Union sponsors a Multi-employer plan which it members are employed at multiple employers?

[rcline46]

Different situation for a multiemployer plan and this is specifically permitted in the code. Does not work for a single employer. Now if you can get the employer to be 'sponsor' and have the union as Plan Administrator and take responsibility it might fly.

[Guest MS TPA]

So what about if the Union is sponsoring a plan for members employeed by only 1 employer?

[rcline46]

This was the original post - the answer is no. Since only 1 employer, it is not a multi-employer plan, and the participants are not employed by the plan sponsor so you violate the exclusive benefit rule.

[Guest MS TPA]

Thank you so much!