Who is a "highly compensated employee" for 125 plan purposes

[Guest chuefner]

Is there any guidance on how the "facts and circumstances" test for whether an employee is "highly compensated" under Q&A-13 of Prop. Reg 1.125-1 is to be applied?

In particular, I'm faced with a company in which all employees would be viewed has "well compensated" earning more than $100,000 per year. Most of the employees are NOT owners and therefore are not "key employees" and do not fall into the other categories for being "highly compensated." For example, does a concept similar to the "top-paid group" under 414(q) apply to allow such a company to establish a 125 plan? Or, does the IRS have a dollar threshold that is applied regardless of the fact that the employees could be classified in groups of well compensated employees and very well compensated employees (and owners)?

Thanks for any thoughts or direction.