Involuntary Distributions - Timing

My question is if a plan has involuntary cash-out provisions set at $5,000 or less and the timing of distributions in the plan document is immediate (meaning as soon as administratively feasible), will the plan sponsor/plan administrator (in all of our plans the plan sponsor is the plan administrator, we are just a service provider) be in violation of their plan document if they aren't processing involuntary distributions (meaning they aren't reaching out to the participant) and they are just leaving the money to sit in the plan? 

I would think they wouldn't be following their plan document; however, I read the following in Notice 2005-5:

Q-9. If a plan that provides for mandatory distributions does not make a distribution to a participant who fails to affirmatively elect direct payment or a direct rollover for a mandatory distribution on or after March 28, 2005, because the plan administrator has not sufficiently established administrative procedures that allow the plan administrator to accomplish the automatic rollover of a mandatory distribution by that date, will the plan be treated as failing to operate in accordance with its terms?

A-9. No, a plan will not be treated as failing to operate in accordance with its terms (including the automatic rollover provisions) with respect to mandatory distributions merely because it does not process mandatory distributions for which the participant does not affirmatively elect direct rollover or direct payment due to a lack of sufficient administrative procedures for automatic rollovers, including establishing individual retirement plans to accept automatic rollovers, provided the mandatory distributions are made on or before December 31, 2005.

any insights?

1 hour ago, Will.I.Am said:

A-9. No...provided the mandatory distributions are made on or before December 31, 2005.

Your answer is right there (my bold).  It was a transition rule.

44 minutes ago, Bird said:

Your answer is right there (my bold).  It was a transition rule.

Exactly, and that means if you are PAST that date, YOU DO HAVE A PROBLEM with not following the terms of the plan document.

I think for those that are now > $5,000, you can no longer require distribution. For those < $5,000, you can, late, and that is correction. Whether insignificant so as to permit self-correction, or not so as to require VCP, depends on facts and circumstances. You might go out to those with > $5,000 and tell them that they can take their money if they want, assuming that is consistent with plan document.