Match different for 2 parts of the year

[Jim Chad]

We are using Corbel's VS.. The document currently gives total flexibility on match.

They want to do what was promised through August 31, 25 cents on 2% of match. On Deferrals starting September 1, they want to match 50 cents up to 5% of comp?

Is this legal or are there problems with this?

[Lou S.]

Is it a per payroll match in the document?

Do they have discretion to change it?

If both are yes, I don't see a problem with the change.

[QDROphile]

Who are the knaves in charge who did not elect to defer before the effective date, or elected a disproportionately smaller amount, and will go all-in after? And who are the chumps who overweighted early?

[Jim Chad]

The document says annual match. totally discretionary for each tier and tiers are discretionary.

[K2retire]

To me an annual match strongly suggests that the matching rate be set for the full year.

[BG5150]

And don't tiers usually refer to levels of contribtuion and not dates?

[Jim Chad]

QDROphile, Good Question! I don't know the answers. New management new ideas. I was thinking that the ADP test should prevent this from being abusive. What do you all think?

[MWeddell]

Consider amending the plan document to do the following for the 2015 plan year only:

(1) Change the match formula for 2015 to be computed on a payroll period basis using 25% of the first 2% of pay deferred through August 31 and 50% of the first 5% of pay deferred after August 31.

(2) However no one's matching amount will be less than 25% of the first 2% of pay deferred when considering contributions and compensation for the entire plan year.

[Jim Chad]

Thank you, everyone.