QNECs for missed deferrals

We're a small TPA firm. I've run into multiple ERISA attorneys advising our mutual clients lately that they must do a 50% QNEC for missed deferrals in situations that seem to me to clearly fall under Rev. Proc. 2015-28 for a reduced QNEC.

The first one said that the lower QNEC can only be used if it is a failure to enroll -- not a failure to follow an election for an existing participant. In this case it was a failure to withhold from bonuses. It was caught and corrected almost immediately.

The second one was a new plan that failed to implement auto enrollment for anyone for several months after the plan began. This is clearly the exact scenario described in the Rev Proc. I won't know until a call tomorrow why the attorney believes it doesn't apply.

Are others finding similar resistance to proposed correction methods?

FWIW I think that when you have an election form, the make up is what the election form says. 

Or is that the old rule?

Can anyone help?

O

Old rule.

Currently, Appendix A, .05(10) states that for purposes of .05(8) and.05(9) - which are the reduced correction items - an "Employee Elective Deferral Failure" includes failure to implement..."an affirmative election..."

Maybe their an "ERISA Attorney" (notes the quotes!) and not an ERISA attorney.  Just becaus they went to law school does not make them experts in ERISA.  We all know you can't dabble in this stuff you have to work on it 12 months a year.

Ahh wait a minute - did you send the notices out in time?  If you didn't send the notice out in time, then you're not eligible for the new correction methods.  Maybe that's it?

'Tis possible. ..

21 hours ago, austin3515 said:

Ahh wait a minute - did you send the notices out in time?  If you didn't send the notice out in time, then you're not eligible for the new correction methods.  Maybe that's it?

Or, maybe the participants involved are no longer employed?