ADP test excludable employee

[EBDI]

The ADP test is run using the excludable disaggregation method.  The software I use categorized two re-hired employees as otherwise excludable.  Both were 100% vested participants prior to their first termination and entered the plan on their re-hire dates (4/20/16 and 7/13/16). Is the software classifying them correctly?  This plan does not use the rule of parity.

[BG5150]

Take a look at their history.  Do you have 1,000 hours coded for any years? 

 

Is there a report you can run that shows why they are excludable?  Relius prints the reasons on one of the pages if you are using that r/k system.

 

[duckthing]

I've found that Relius (if that's indeed what you're using) doesn't always handle rehire eligibility correctly, especially for disaggregation. To be fair, that may be my own inexperience using it rather than a shortcoming of their system!

My understanding is that if you're testing excludables separately, Relius excludes anybody who hasn't met "age 21 and hired at least 18 months prior" even if some of those people have met the plan's entry requirements and are in fact deferring. It may only be looking at the rehire date to make the "18 month" determination. If that's the case then my answer to your question would be "no."

[Tom Poje]

on the other hand, if using Relius and the person terminated and you deleted them from the system, even though they show back on the system, my experience is prior years are not restored, and therefore the system thinks they fail the 1 year service rule.

so I would check years of service the person has. (If not Relius I would be curious as well, just to know what might be going on with another software) 

[BG5150]

You can always send in a help ticket to whatever software vendor you have and ask them.

[EBDI]

Thanks for the advice.  I am using ftwilliams.  I sent them a help request and they sent me advice on how to override the system. They didn't explain why the system was placing them in the other excludable group in the first place. 

[BG5150]

You should press them for an answer so you can avoid this in the future without having to override the system.

[EBDI]

Tom's suggestion was correct.  The system did not restore their previous YOS. Thanks everyone for the help.

[Tom Poje]

I should have added "and therefore you need to enter years of service prior to running eligibility"

but I do appreciate confirmation that is what happened, despite the fact it might be different software

[TPApril]

On the theme of a participant who is considered an excludable employee in the system, but a different scenario..

Employee hired 12/21/15. System is treating him as otherwise excludable for 2016. I generally treat 1/1 as the cut off date. Is this standard, perhaps if hired after 12/15 to exclude them for the following year?

[BG5150]

if DOH = 12/21/15 you could theoretically keep him out until 6/21/17 (6 months after 1 YOS.), so I'd say he was otherwise excludable.

(Even with 1 YOS and semi annual entry dates, he could be kept out until 1/1/17)

[Tom Poje]

if it is a calendar year plan, then you pretty much have to have and entry date of 1/1

BG5150 sort of said this but in a round about way.

(I have one plan that has 12/31 as an entry date (or 1 day before 1/1, so the 1/1 rule never comes into play)

so the general rule is 1/1 (if hired 7/2 or later - because someone hired 7/2 completes 1 year on 7/2 and enters 1/1 following, but someone hire 12/30 completes 1 year on 12/31 and also enters on 1/1)

) or 6 months after 1 YOS (if hired first half of the year) for max exclusion.

[Belgarath]

Hey Tom - just to nitpick  a little so newbies aren't confused - I'd say that if hired 7/2, then 1 year of service is completed 7/1, not 7/2. This can be a big deal for Entry dates that are "coinciding with or next following."

I'd also say that someone hired 12/30 completes 1 year of service on 12/29, not 12/31.

[TPApril]

I found a related article put out by ACOPA last year that discusses the use of the maximum allowable excludable period:

https://www.asppa.org/News/Article/ArticleID/6278

 

[Tom Poje]

Belgareth - Eye Kant tipe werth eh durn -at least with the 12/30 date.

my apologies on the dates.

though in the case of 7/2 example it depends on whether you use inclusive or exclusive logic

[Belgarath]

True - I know this has been debated over the years, but "most" people in my experience take the same interpretation. "Go not to the elves for counsel, for they will say both no and yes."

[Tom Poje]

Quote

 

ah, quoting from one of my favorite books (not the movie)

I guess you could have said

"Go not to the actuary for counsel, for they will tell you "What do you want the answer to be"

[Belgarath]

Haven't seen any of the movies. My policy is to never watch a movie made from a great book. No movie can match the experience of great books, even though the movie might be objectively great. And although I've heard rave reviews about the movies from my kids, I've also heard enough to know that the movies (as they all do) take certain liberties and deviate from the books, which I find most distressing.

[Tom Poje]

agree. I have the book on CD Rom, which is close to 50 disks. never get tired of listening to it. it is the book plus the 'appendix' or whatever the additional material at the end of the book had and some comments based on an interview with Tolkien. I have seen parts of the movie, perhaps it gives an idea of the atmosphere, but what little I saw changed the characters enough to turn my stomach. (much less changing the Hobbit entirely so they could make it into 3 movie$$$$$$)

I can't image going to a concert and listening to a Beethoven symphony and finding some of the movements were eliminated, some were changed to 'liven' things up, etc.

 

but then you sound like one after my heart!

[My 2 cents]

3 hours ago, Tom Poje said:

ah, quoting from one of my favorite books (not the movie)

I guess you could have said

"Go not to the actuary for counsel, for they will tell you "What do you want the answer to be"

Just for the record, whether that sort of thing used to be true or not, or even if it still happens, "what do you want the answer to be" is a clear violation of the standards applicable to actuaries.  Just saying.