Rule of parity when using a 6 month requirement for eligibility and de

[Guest LMalone]

How is the rule of parity applied when using a 6 month service requirement? For example, an employee works 4 months and quits. Three years later the employee is rehired. Must the Company count those 4 months?

Also, is "month" a defined term? In the above example, if the employee had first worked 4 months and 10 days and upon his return works 1 month and 20 days, has he completed six months?

I would appreciate any thoughts.

[Bill Berke]

I always believed and operated under the interpretation that the rule of parity applies to and reflects each plan in accordance with that plan's eligibilty service rules. Thus in your example that person would start over because thay weren't a participant upon termnation and they were gone longer than employed. If the plan's eligiblity was one year, then rule of parity looks at one year period not employed. Also, month should be defined in plan document e.g. 83 hours of service in calendar month to get creditfor the month. If there is no definition, then get plan administrator to put memo in file detailing its operating defintion to follow when crediting service. Does 15 days worked mean credit for that month? Memo must define all and tell how to credit under the various possiblities. Suggestion: keep it simple and clear - which usually means using an hours worked standard - but I think that an hours worked standard must be in document.

[This message has been edited by Bill Berke (edited 06-13-2000).]

[Kirk Maldonado]

If you are not counting hours of service (but rather, measuring the period of service), you need to use the "elapsed time" method of crediting service.