Jump to content

Recommended Posts

Posted

An individual met the 1 YOS/1000 hours requirement in the past and was employed for 15 years.  He did not contribute to the plan and has never had a balance.  He leaves for 2 years (has 2 BIS) and then returns.  The 401k plan does not use the rule of parity and does not use the one year hold out rule.  He would be eligible to re-enter immediately, is that correct?

Can we ever disregard YOS for eligibility in a situation like this?  What if he left after 3 years, was not 100% vested (he did not have a balance regardless), has 3 BIS and then returned?

I've checked the document and it is confusing.  This has to be addressed in it but without having anything specific to point to that says "disregard the following service..." I do not think we can ever disregard any eligibility service.

Any comments are appreciated.

 

Posted

Since you note that the plan does not use the rule of parity and does not use the one year hold out rule, it seems you have read the plan document correctly and the individual is eligible to participate upon rehire.  Is there other language in the plan document that is causing some confusion?  If you have read the plan document correctly, you won't find an explicit statement in the plan document that says otherwise.

If you are uncomfortable with your reading of the plan document and have a colleague that is knowledgeable about plans and eligibility rules, ask them if you can give them a copy of the plan document to get their input on how it applies to this individual's circumstances.

Posted

I think your comment at the end of the first paragraph is what I was hung up on.  I was thinking there would be a statement saying that unless indicated otherwise in the adoption agreement, all service is counted and none is disregarded.  But that statement would not appear necessary if we are not using the rule of parity/1 year hold out.

Thanks for replying.

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...

Important Information

Terms of Use