Union Ee's / Top Paid Group

[austin3515]

If I meet the requirements to exclude union employees when determining the top-paid group, how do I determine which union employees are HCE's (assuming they are over 115K)?

[ETA Consulting LLC]

The exclusions are done "ONLY" to find the number to be included in the top paid group; not who may be considered HCE.

Good Luck!

[austin3515]

Interesting... So let's say there are 5 non-union ee's, and the highest paid of the 5 made $120,000, but the highest union employee made $125,000, the non-union plan can skip the ADP test because there are no HCE's, correct? The union plan has to run its test of course.

[austin3515]

Anyone have any thoughts on this question?

[austin3515]

I have an update -

Cite: 1.414(q)-1T (A-9)(b)(1)(iii)(B)

(B) Percentage exclusion provision. If 90 percent or more of the employees of the employer are covered under collective bargaining agreements that the Secretary of Labor finds to be collective bargaining agreements between employee representatives and the employer, which agreements satisfy section 7701(a)(46) and § 301.7701-17T (Temporary), and the plan being tested covers only employees who are not covered under such agreements, then the employees who are covered under such collective bargaining agreements are not counted in determining the number of noncollective bargaining employees who will be included in the top-paid group for purposes of testing such plan. In addition, such employees are not included in the top-paid group for such purposes. Thus, if the conditions of this paragraph (b)(1)(iii)(B) are satisfied, a separate calculation is required to determine the number and identity of noncollective bargaining employees who will be highly compensated employees by reason of receiving over $50,000 and being in the top-paid group of employees for purposes of testing those plans that cover only noncollective bargaining employees.

My summarization

In other words, I think it is very clear that this exclusion does not apply AT ALL for the union plan. Therefore, when determining the number and identity of HCE's for the union plan, the non-union employees would be included in the calculation - the calculation essentially ignores any distinction between union and nonunion for purposes of determining HCE's in the union plan.

Agree? Anyone?