Union plan in a right to work state

Perhaps it's too much eggnog, but I can't seem to wrap my mind around this issue.

We have a client with 2 plans. One plan excludes union employees. The other covers only union employees. They are in a right to work state and have many employees who have chosen not to join the union. I believe the employees covered by the collective bargaining agreement, whether or not they choose to join the union,  belong in the union plan.

Is that sufficient to make them excludable in the non-union plan testing? Or must they actually be union members to be excludable?

4 minutes ago, K2retire said:

I believe the employees covered by the collective bargaining agreement, whether or not they choose to join the union,  belong in the union plan.

That would make sense to me.

FWIW, my document defines "union employee" as an employee covered by a CBA and makes no reference to union membership.  

3 minutes ago, RatherBeGolfing said:

FWIW, my document defines "union employee" as an employee covered by a CBA and makes no reference to union membership.  

Mine does as well. I just wasn't sure what the definition was regarding excluding them for testing purposes.

1 hour ago, RatherBeGolfing said:

FWIW, my document defines "union employee" as an employee covered by a CBA and makes no reference to union membership.  

Seems like a pretty good response.  Another phrasing might be, "What does the plan document say?"

A collectively bargained employee can be (if other conditions are met) one who is included in a collective-bargaining unit even if the employee is not a member of the labor union that serves as the unit’s representative.

“The requirements of [IRC § 401(a)(4)] are treated as satisfied by a collectively-bargained plan that automatically satisfies section 410(b) under § 1.410(b)-2(b)(7).”

26 C.F.R. § 1.401(a)(4)-1(c)(5) https://www.ecfr.gov/cgi-bin/text-idx?SID=f3b5bc3ae83784c7e815b36bb79fbbab&mc=true&node=se26.6.1_1401_2a_3_24_3_61&rgn=div8

“A plan that benefits solely collectively bargained employees for a plan year satisfies this paragraph (b)(7) for the plan year.  If a plan (within the meaning of § 1.410(b)-7(b)) benefits both collectively bargained employees and noncollectively bargained employees for a plan year, § 1.410(b)-7(c)(4) provides that the portion of the plan that benefits collectively bargained employees is treated as a separate plan from the portion of the plan that benefits noncollectively bargained employees.  Thus, the mandatorily disaggregated portion of the plan that benefits the collectively bargained employees automatically satisfies this paragraph (b)(7) for the plan year and hence section 410(b).  See § 1.410(b)-9 for the definitions of collectively bargained employee and noncollectively bargained employee.”

26 C.F.R. § 1.410(b)-2(b)(7) https://www.ecfr.gov/cgi-bin/text-idx?SID=474fc265e9f103c40593f277b1d96c6b&mc=true&node=se26.7.1_1410_2b_3_62&rgn=div8

“Collectively bargained employee means a collectively bargained employee within the meaning of § 1.410(b)-6(d)(2).”

“Noncollectively bargained employee means an employee who is not a collectively bargained employee.”

26 C.F.R. § 1.410(b)-9 https://www.ecfr.gov/cgi-bin/text-idx?SID=474fc265e9f103c40593f277b1d96c6b&mc=true&node=se26.7.1_1410_2b_3_69&rgn=div8

“A collectively bargained employee is an employee who is included in a unit of employees covered by an agreement that the Secretary of Labor finds to be a collective bargaining agreement between employee representatives and one or more employers, [if] there is evidence that retirement benefits were the subject of good faith bargaining between employee representatives and the employer or employers.  An employee is a collectively bargained employee regardless of whether the employee benefits under any plan of the employer.  See section 7701(a)(46) and § 301.7701-17T of this chapter for additional requirements applicable to the collective bargaining agreement.  An employee who performs hours of service during the plan year as both a collectively bargained employee and a noncollectively bargained employee is treated as a collectively bargained employee with respect to the hours of service performed as a collectively bargained employee[,] and a noncollectively bargained employee with respect to the hours of service performed as a noncollectively bargained employee.  See § 1.410(b)-7(c) for disaggregation rules for plans benefiting collectively bargained and noncollectively bargained employees.”

26 C.F.R. § 1.410(b)-6(d)(2)(i) https://www.ecfr.gov/cgi-bin/text-idx?SID=474fc265e9f103c40593f277b1d96c6b&mc=true&node=se26.7.1_1410_2b_3_66&rgn=div8

Thanks Peter -- that's exactly what I needed.