Basic SHM & Dual Eligibility

I have a plan that currently has a basic safe harbor match.  Deferrals and SH have same eligibility of age 21 & 1 year w/1000 hours.  They want to change deferral eligibility to immediate upon date of hire, but leave the SHM eligibility as is.  Is this allowed?  If so, can this be changed mid-year or must it be effective 1/1/2019?

Yes it's allowed.  You can make this change mid year as long as you provide an updated SH notice and satisfy the election opportunity conditions.  See Notice 2016-16 for details on mid-year changes to safe harbor plans

Notice 2016-16.pdf

Is this a Top Heavy plan?

If it is, the plan will be giving 3% Top-Heavy to Immediate entry employees.

And probably won't be an issue, but you have to run an ADP test on those not getting the safe harbor because of immediate entry.

Thank you for the responses.

Under Section III.D.2. of Notice 2016-16, do you also agree that it is permissible to amend the plan mid-year to prospectively require new employees to complete a year of service to receive the SHM?