Suspension of payments

[Guest MJ1]

Is it problematic to allow payments to be suspended where the employer believes a participant is violating a non-competition agreement that would justify the forfeiture of remaining payments? I think it's okay provided there is no collusion between the employer and employee.

[Ron Snyder]

The employer should first obtain advice from his legal counsel about the appropriateness of such an action.

[Guest MJ1]

The employer should first obtain advice from his legal counsel about the appropriateness of such an action.

Thanks, Vebaguru. I agree, but am considering this from a plan document standpoint. Is it okay for a plan to include such a clause where the plan provides for the forfeiture of unpaid benefits where a participant violates a non-competition agreement? The employer should be able to cease making payments it it believes that the employee is violating a non-competition agreement, even if it is later determined by a court that he or she was not and amounts are due. Do you agree?