new plan and eligibility

[Tom Poje]

Employee C has worked for 5 years.

The company puts in a new plan with an effective date of 1/1/2010 and signs the the document 12/20/2010

Employee C quits 11/30 after working 1000 hours.

Is the employee eligible for the plan because you can't exclude service for eligibility, or is he ineligible because he quit before the date the plan was signed?

[Belgarath]

Eligible.

Of course, may not get an allocation, but you'd have to include for coverage and testing. I suppose I should qualify this a bit - I guess if you had some prior service that could be disregarded under the BIS rules, then it might change the overall result. I havn't really thought that part through.

[Tom Poje]

Those are my thoughts

(I am of course referring to the nonelective feature. since you cant defer on past $, I'd hold the effective date for the 401k portion starts when the document is in place, but his is not a 401k plan I was referring to)