Deferral Reduction not implemented

Plan recently discovered 5 or 6 people who had requested deferral percentage reductions that were never implemented. Most are short term, but others go back several years. None of the participants has noticed the error.

Client wants to notify the participants and ask them if they want to take the money out of the plan (including match and income) or leave it in. Not sure that this is permissible. Haven't run into this particular failure before, and cannot find anything terribly helpful in EPCRS. My inclination would be to forfeit all if they want to correct, and pay the lost salary outside of the plan.  

19 hours ago, PJF414 said:

None of the participants has noticed the error.

You have to use some common sense.  I'd go to them and ask if they want to implement the lower elections going forward.  Tell the client some things aren't fixable.

Agree with Bird.  Definitely would not give them the match.