401(k) for Owner of Union Shop

[drakecohen]

Is this scenario feasible?

Plan company owner has all union employees and is also paying union dues on his salary.(to get in the union health plan?)

Can that owner employee receives his compensation in two parts:

(a) compensation subject to union dues and

(b) compensation not subject to union dues

and be eligible to maintain a separate plan for himself alone using that part of his compensation not subject to union dues?

[david rigby]

No doubt others can state this more eloquently than I can, but you might be assuming something. IRC 410 defines the "minimum participation standards" and 410(b)(3) contains the "union exclusion". Hoewever, it's not that simple.

410(b)(3) Exclusion of certain employees

For purposes of this subsection, there shall be excluded from consideration—

(A)employees who are included in a unit of employees covered by an agreement which the Secretary of Labor finds to be a collective bargaining agreement between employee representatives and one or more employers, if there is evidence that retirement benefits were the subject of good faith bargaining between such employee representatives and such employer or employers,...

Is there such evidence?

[My 2 cents]

Does the union know that the owner is contributing dues on his or her behalf to obtain union benefits? Are they OK with that?

[Belgarath]

Seems to me that it might be feasible, if he is legitimately dual status. See 1.410(b)-6(d)(2)(i)

However, this is a potentially tricky situation, and I'd recommend getting blessing from ERISA counsel before proceeding with such a plan.

[movedon]

How does the employer engage in "good faith bargaining" with itself?