401k employee contribution based on age and seniority

[ml752]

What is the name of your state (only U.S. law)? NY

Is it legal if a 401(k) Plan Document allows for a variable contribution based on, at the same time, years of service and age at a certain date.
ex. employees who are 55 years old with 15 years of seniority on July 1st 2011 receive an extra 8% employee contribution, those with 50y and 10 years 7%, otherwise 0% for other employees ?

 

[cbg]

It can be. Because 401k plans did not exist when the older folk were younger, the law specifically allows for certain "catch up" provisions that allows those over 50 to contribute more than the Federal limit. It's impossible to tell by your description whether that is what's happening here, but it's not inherently illegal, either. One would have to have read the plan document to say for certain.

 

[ml752]

It can be. Because 401k plans did not exist when the older folk were younger, the law specifically allows for certain "catch up" provisions that allows those over 50 to contribute more than the Federal limit. It's impossible to tell by your description whether that is what's happening here, but it's not inherently illegal, either. One would have to have read the plan document to say for certain.

In what case is it illegal to have various levels of employers' contributions based on age and seniority at a certain date ? I am not talking about the employee contribution and the Federal limit.
is it ok to say :
1/ you will be 50 years old with 15 years of seniority on 4/1/11, so you receive 10% of employers' contribution (401k existed 10 years ago).
2/ you will be 47 years old with with 15 years of seniority on 4/1/11, so you will receive 5% of employers' contribution
does that look legal ? why is it different ? : because one guy is 50 and the other guy is 47 but they have the same seniority.

 

[cbg]

Let me ask you a question so that we can avoid all these what-if games.

Is the rule you are questioning a part of your 401k plan document?

 

[ml752]

Let me ask you a question so that we can avoid all these what-if games.

Is the rule you are questioning a part of your 401k plan document?

if you think it is a what-if game and that you are tired of typing, lets stop the discussion. we are going nowhere !

 

[Beth3]

cbg is simply trying to get clarification from you on what exactly your question is related to so it can be answered. The laws governing 401(k) Plans are far more complicated than you are likely aware.

 

[pattytx]

if you think it is a what-if game and that you are tired of typing, lets stop the discussion. we are going nowhere !

Chump don't want da hep, chump don't get da hep.

 

[cbg]

The tired-of-typing reference is a part of my signature, was not directed at you personally, and does not apply in your situation anyway.

But the answer to YOUR question, depends in part of the answer to MY question.