Different vesting schedules

A 401k plan has a 4 year graded vesting for all employees. The question is can they have a different more generous schedule for a certain job class, for example nurses. There are HCE's and NHCE's in the nurse job class. Will this require BRF testing? Thank you!

Sure, but if your testing demographics can support it, it's okay to have.  And you know, make sure the bases are covered for switching in/out of classes.

Wow, this begs for a larger discussion.  Including, what are you trying to accomplish?  What problem(s) are you trying to solve?  Etc. You need an experienced consulting actuary.

Going into a rebid where another vendor is showing off what they can do with special vesting. I do not really like it but need to explore options. This is healthcare industry, they are competing for nurses and healthcare workers who come and go. Need to provide incentives to keep them. It looks like we could add a special non-elective contribution for this job class (the plan has a match), and it would be nice to show case we can offer accelerated vesting for this group. Just ideas right now to be address client needs. thanks!

Most systems allow you to create multiple employer accounts and assign a different vesting to each account.  This also is not uncommon where a match has a different vesting schedule than a profit sharing contribution, or a participating employer has a different vesting schedule from the plan sponsor, or union members have a different vesting schedule from non-union participants, or the plan changed vesting schedules and had to grandfather existing participants who were already partially vested....

I think you get the picture.  This should not be difficult to accommodate.

Yes I agree and I’m glad you shared this. Thank you!