Maternity Leave & Last Day Contribution Requirement

I'm 99% sure I know the answer, but I wanted to be 100% sure.  If a participant is on maternity leave at the end of the year, are they still considered employed on the last day of the Plan Year in order to be eligible for a Profit Sharing contribution (the participant had worked over 1,000 hours prior to going out on leave)?

Thanks in advance!

Doesn't sound like a severance of employment to me.....

Agree - not a severance of employment. 

Thirded!

If the absence is “(i) by reason of the pregnancy of the individual, (ii) by reason of the birth of a child of the individual, (iii) by reason of the placement of a child with the individual in connection with the adoption of such child by such individual, or (iv) for purposes of caring for such child for a period beginning immediately following such birth or placement,” ERISA §§ 202-203 set up mandated provisions for crediting service and not having a break in service.

And the U.S. Family and Medical Leave Act might provide some benefit-continuation rights.

These might bear on how a plan’s fiduciary reads and interprets a last-day condition.

If the employee met the eligibility and entry provisions before start her maternity leave, then she is will get an allocation at the end of the year. 

Some plans have a provision that an employee who would first meet the eligibility and entry requirements after starting maternity leave are excluded from receiving an allocation as of the plan year end allocation date, BUT upon return from maternity leave, the employee must be given an allocation as if she was active on the allocation date.  If the employee in the OP started leave under these circumstances, then check the plan provisions applicable to leaves of absence and year-end allocations.