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What is a Multiple Employer Plan (MEP)?

A Multiple Employer Plan, or “MEP”, is a retirement plan that is maintained by two or more unrelated employers that are not members of the same controlled group. Employers are characterized as “Adopting Employers” when they elect to participate in the MEP. MEPs can be…

What 401(k) RESA Legislation Means for MEPs and PEPs

…with the DOL’s long-standing views on independence[4] and “control in fact”[5] by adopting employers. An uncompensated lead employer (in a related group of employers) or a membership association acting as a fiduciary are also tried-and-true structures. A PEP could presumably follow these approaches with confidence….

How Does A Cash Balance Plan Work?

…to career average traditional defined benefit plans. Employers typically find they can get “more for less” by providing a more easily understood and appreciated benefit at a lower cost. FLEXIBILITY – Plan features afford the employer maximum flexibility and can be designed to meet both…

Are More Modifications Needed Before We Feel SECURE?

…As with the Multiple Employer Plan (MEP), the economies of scale allow the participating employers to charge lower fees than traditional plans. Both models are designed to benefit small businesses who otherwise might struggle to afford a traditional plan. What is different is that, with…

401(k) Plan Design and Automatic Features

An automatic contribution arrangement (also known as automatic enrollment) is a feature in a retirement plan that allows an employer to “enroll” an eligible employee in the employer’s plan unless the employee affirmatively elects otherwise. “Enroll” in this context means that part of the employee’s…

Credit Unions: Make Sure You Know Your Fiduciary

…increasingly have been turning to Multiple Employer Plans (MEPs) to alleviate these concerns. A MEP relieves the employer of full fiduciary responsibility – an area where a given credit union may not have the necessary expertise; shifts administrative duties to the provider; and benefits both…

What is a Safe Harbor Plan?

…Safe Harbor Contribution Requirement for Plans with Qualified Automatic Contribution Arrangement These safe harbor plan designs require 100% vesting after 2 years of employment. 3% (non-elective employer contribution – “NEC”) of salary for all eligible employees, or An employer matching contribution which results in a…

Cross Tested Plans

…presumably “key” employees, while younger, and/or lower paid employees receive a lower percentage of the total employer contribution to the plan. New Comparability plans are typically designed to benefit owners and key employees over rank and file employees, and can be used if the employer

Which Types of 403(b) Plans Are Subject to ERISA?

…in order to claim an exemption from ERISA: Participation must be voluntary. All rights under the annuity contracts or custodial accounts must be enforceable by the employee or beneficiary (not the employer.) Involvement of the employer must be limited to certain restricted activities. The employer