Quarterly entry and 1,000 hours

[Guest JPIngold]

I have a plan on Relius Admin .... participant was hired 3/20/10 and only worked 300 hours in 2010. As of her 1-year anniversary, she had only worked 500 hours. She went to full time at about that time and as of 9/30/11, she had worked 1,100 hours in calendar 2011.

The plan has quarterly entry, eligibility service is anniversary date with a shift to calendar, one year of service/age 21.

I have always taken the position that if not 1,000 hours in the first anniversary year, then the person has the next calendar year to satisfy the requirement and if they do, would enter on the first entry date in the next plan year.

Relius, though, is allowing this person to enter on 10/1/2011 because she had 1,000 hours in 2011 before the final entry date in the year.

Just wondering if others have seen this and whether you agree with my position or with Relius.

Thanks.

James

[Guest JPIngold]

I just found a thread from 2009 that addresses the same issue. "SIEVE" (Larry S.) opined in agreement with my position. In his response, he mentions "passage of the full 12months", which is exactly my position on the issue. Just because the person hits 1,000 hours within the year, they have to complete that year in order to meet the requirement and enter on the first day of the following year.

Anyone have anything to refute this position???

If not, it sounds like I need to override Relius' determination of this employee's eligibility.

[Lou S.]

I agree with you. Part should be eligible 1/1/12 under your facts and cirumstances.

[Tom Poje]

I would agree as well, but without knowing how the plan entry is coded or other facts I wouldn't know if it is a bug or a coding problem.

we have so few plans processed more than once a year I wouldn't know for sure.

[K2retire]

It's been a few years since I've used Relius, but there used to be a way to code that to work properly. It's probably something in your plan specs.

[buckaroo]

First thought:

On the plan specs, Plan Entry Requirements screen, there is a check-box called "Waiting Period Exclusive". I believe that if this box is checked, it means that the participant needs to complete the full "Computation Period" prior to entering the plan. Conversely, if it is not checked off, then it means that the participant would enter the plan upon meeting the the elig requirements on the very next entry dates.

Is this coded correctly?

[EBDI]

I hate to be the lone wolf who disagrees. The participant satisfied the 12 month requirement on 3/20/2011. The 1000 hour requirement was satisfied by 9/30/2011, therefore the participant enters on the next entry date which is 10/01/2011. Is there something in the plan document that indicates the participant has to satisfy the 12 month requirement more than once?

[Guest JPIngold]

I hate to be the lone wolf who disagrees. The participant satisfied the 12 month requirement on 3/20/2011. The 1000 hour requirement was satisfied by 9/30/2011, therefore the participant enters on the next entry date which is 10/01/2011. Is there something in the plan document that indicates the participant has to satisfy the 12 month requirement more than once?

My interpretation stems from the definition of year of service and the eligibility provision. For year of service, it reads "the computation period of 12 consecutive months during which an Employee has at least 1,000 hours" .... with the initial period being the first 12 months of employment and then shifting to calendar year. The eligibility provision reads "any Eligible Employe who has COMPLETED one (1) Year of Service" shall be eligible ....

So, in my opinion, you don't COMPLETE the year of service until the END of the "computation period", regardless of what date you work your 1,000th hour.

Therefore, looking at your analysis, yes, the participant finished his 12-month anniversary period on 3/20/11, but he had not worked 1,000 hours in that year. Thus, we have to look at his next computation period which starts on 1/1/11 and ENDS on 12/31/11. Regardless of when he hits 1,000 hours, he hasn't completed his computation period until 12/31/11, meaning he can not enter until 1/1/12.

[Guest JPIngold]

First thought:

On the plan specs, Plan Entry Requirements screen, there is a check-box called "Waiting Period Exclusive". I believe that if this box is checked, it means that the participant needs to complete the full "Computation Period" prior to entering the plan. Conversely, if it is not checked off, then it means that the participant would enter the plan upon meeting the the elig requirements on the very next entry dates.

Is this coded correctly?

I tried that and it didn't make a difference. So, I am simply suppressing the final quarter's eligibility transaction and deleting the "date elig requirements met" in census and then running 4th quarter.

[Tom Poje]

waiting period exclusive is really used for the situation such as

ee hired on 1/2. now (yes or no) do you complete 12 months on 1/2 or 1/1? that would effect whether you enter 1/1 or 7/1.

in census there is also a field 'met entry requirements' - obviously that has been set to something you don't want.

my practice after the plan has been on the system 1 year is to set "calculate past year service" to "not computed".

there is no reason to calculate past service once the plan has been on the system. that might not even change things in your case, but one never knows.

[Guest JPIngold]

waiting period exclusive is really used for the situation such as

ee hired on 1/2. now (yes or no) do you complete 12 months on 1/2 or 1/1? that would effect whether you enter 1/1 or 7/1.

in census there is also a field 'met entry requirements' - obviously that has been set to something you don't want.

my practice after the plan has been on the system 1 year is to set "calculate past year service" to "not computed".

there is no reason to calculate past service once the plan has been on the system. that might not even change things in your case, but one never knows.

Yes, that met entry requirements is getting populated with 9/30/11 when that quater's eligibility is run. So that is what I am now deleting before running 12/31/11 eligilibity and thus the employee is not entering on 10/1/11.

[Guest 410b]

I know this is an old thread-I saw it when I was looking for entry date threads in relation to my new post.

I just had to recompute a number of participant years of service because of my misunderstanding of this issue in my company's plan.

I have been specifically instructed by our third party plan administrator that I am to follow the pattern submitted by EBDI.

I think JPINGOLD's analysis depends on whether conversion happens in the calendar year containing the employment commencement date or the yyear containing the anniversary date.

[MoJo]

I know this is an old thread-I saw it when I was looking for entry date threads in relation to my new post.

I just had to recompute a number of participant years of service because of my misunderstanding of this issue in my company's plan.

I have been specifically instructed by our third party plan administrator that I am to follow the pattern submitted by EBDI.

I think JPINGOLD's analysis depends on whether conversion happens in the calendar year containing the employment commencement date or the yyear containing the anniversary date.

Most plans I see (and write) require the 1000 hours to be completed "within" a specified 12 month eligibility period. That is, if you don't satisfy BOTH requirements within one period, BOTH requirements are reset and start anew. With the flip from anniversary date to calendar year, that would mean that regardless of when you get the 1000, you still do not enter the plan until the first entry date AFTER the end of the current 12 month period (i.e., the first of the next year).

[Guest 410b]

I believe that both EBDI and my TPA disagree with the interpretation that BOTH requirements are reset.

The rules I am to follow are that the 12 months of the first eiligibility period (ann. yr.) must run. The participant is not then required to meet another 12 month time requiement if they did not get 100o hrs in the first eligibility period. Subsequent eliegibility periods are plan years and the e,ployee enters the plan on the first entry date after serving 1000 hrs in a plan year ie Oct1 in the example above.

(And, in my plan at least, continuous employment during a 12 month period is not required as part of the 1000 hour service requirement. They each have separate definitions. An eligibility computation period is an elapsed amount of time. A service requirement is 1000 hours in an eligibility computation period. Plan entry requires only that each be met once.)

[Tom Poje]

The ERISA Outline book 2.12

3. when a year of service is credited for eligibility purposes.....at the end of the eligibility computation period (emphasis the book, not mine)

3b. Plan may provide for credit sooner

3b1 example the plan document is written so that a year of service is credited at the end of the month in which 1000th hour is credited...

a plan should not be administered in this fashion unless the terms of the plan expressly provide for this method of crediting a year of service.(emphasis the book not mine)

so if I understand the question in point

ee hired for example 5/1/10 did not work 1000 hours from 5/1/10 - 4/30/11.

document language is the typical 'shift to the plan year'

so now the person works 1000 hours from 1/1/11 - 12/31/11

doesn't matter when they complete the 1000 hours, you have shifted to a new 12 month eligibility computation period, and the credit is provided at the end of the period.(unless there is special document language)

[david rigby]

I have been specifically instructed by our third party plan administrator ...

Sometimes its amusing to see who is giving orders and who is following them.

[MoJo]

Sometimes its amusing to see who is giving orders and who is following them.

That deserve a definate "LIKE" :-)

[Guest 410b]

MOJO and TOM,

Red Face ( I think - I am in the process of finding out) but thank you for the responses and causing me to review what i've been doing.

I have been rereading some old email which hid what you - and likely my TPA- are saying to me.

I had a rehired employee who did not meet the 1000 hour reqt in their anniversary year. Rehired in the next Plan year and worked 1000 hours. I was still struggling with plan and administrator changes at that point.

Employee worked 1000 hours from July to December so I asked if plan entry date was Jan 1. (In my mind bcause the employee had done 1000 hours and hit a quarterly entry date.)

TPA said yes (because the plan year was up).

Had it come up for Oct instead of Dec, I think I would have gotten a different answer.

Thanks again for the help.

[Guest 410b]

Well, "instructions" appear to have come from misinterpreting an answer.