Pop discrimination safe harbor

Hello, 

I know there is a pop section 125 safe harbor from further discrimination testing if you pass the eligibility test. I’m newer to this and a bit confused. Below is the situation- does it qualify for the safe harbor eligibility test and if not why not? My concern is that the 1 and only HCE is enrolled so that’s 100% and the 40/190 is 21% but the 40/500 is only 8% and I’m not sure if the denominator for the formula includes all those new employees in initial measurement periods and ongoing employees in new measurement periods. 
 

1) fully insured 

2) all participants are offered the identical benefits for identical pricing with identical eligibility rules 

3) only 1 HCE and they are enrolled 

4) at any given time 190 employees on payroll roughly 

5) 500 w2s created at year end (high turn over retail) 

6) 40 are eligible for benefits in any given year 

7) all other active employees are either 1) in initial one year measurement period as variable hour new hires or 2) ongoing employees in a new measurement period 

8 ) every employee is eligible if they average 30 hours a week during a measurement period (no different treatment by class/title)