QACA for a restaurant group--Exclude tips under comp def?

[TPAJake]

I see no way to accurately track tips in a restaurant environment of this size & we'd like to insulate the Plan from that variable. Does the exclusion of tips cause a problem with the compensation definition? How would you negotiate such a situation? They're already locked into the QACA structure unless the ERISA atty pulls a rabbit out of his hat...

[Belgarath]

You've found one of the great mysteries of our time, and I'm not sure anything works in all situations. First, I'd say that excluding tips is very likely to cause a discriminatory definition of compensation, assuming you have any HC's eligible for the plan.

Here's some prior discussion of the issue, which doesn't really offer any concrete solutions, but may nevertheless be helpful - or may just add to the confusion!

http://benefitslink.com/boards/index.php/topic/56483-tips-w-2-comp-definition-safe-harbor-match-per-payroll/?hl=tips

[TPAJake]

Thanks for the link, I'll check that out. Good point about the definition being discriminatory, I didn't really think about the fact that the HCE's would not have any tips to exclude. I knew this Plan was going to be a challenge from the start, even before this comp issue. Multiple locations, citizenship issues, seasonal employees, high turnover, you name it.

If anybody has any ideas/experience on how to streamline a Plan like this I'm all ears! All my favorite stories begin with "If I could start over again".