Change in vesting schedule

[QNPG]

My client would like to fully vest all employees employed as of June 30, 2011. They are acquiring another entity and want to apply the vesting schedule for all employees employed on and thereafter July 1, 2011.

Would this amendment require a 401(a)(4) BRF test?

I am of the opinion that as of the date of the amendment (June 30, 2011), this amendment is non-discriminatory in nature since it applies to ALL employees of the employer. There are more NHCEs which would be vested fully than HCEs. Further, with the 3-year vesting rule, the new employees would not have the right to choose to stay with the old vesting schedule and the employees who have accrued three years of service would of course elect to be 100% vested.

Am I missing something?

[Jim Chad]

FWIW I think this is nondiscriminatory.