Retroactive CBA?

[Flyboyjohn]

During CBA negotiations certain union-member employees become elgibile for 401k plan and make contributions.

When CBA is finalized a few months later it's made retroactively effective to a date prior to when the union employees made contributions so they're now "retroactively" excluded.

Can we (and must we) distribute the interim 401k deferrals? Is this a VCP type of event? Could we just amend the plan to override the union exclusion for the interim period?

Thanks

[Effen]

This is a legal question and should be run through fund counsel.

My thought would be that if they were really eligible for the 401(k), I don't think they could be retroactively excluded at a later date. You may interpret the exclusion to become effective on the date the CBA is signed and 401(k) deferrals made after that day should be refunded. I don't see how 401(k) deferrals that were made while they were plan participants could be returned.

I think this all hinges on weather or not they were really eligible for the plan while the CBA was being negotiated.