Plan Sponsors: Do You Know How Layoffs, 部分计划终止 Impact 退休计划?
回到四月, as companies looked for ways to cut costs amid the COVID-19 (coronavirus) crisis, 美国.S. 失业率达14%.7%是大萧条以来的最高水平. 而 downsizing the workforce can help companies remain afloat, choosing to layoff employees can have serious implications on other aspects of your business. 特别是贵公司的退休计划.
如果裁员规模很大, a partial plan termination may occur and create major financial implications for a plan sponsor and it’s important for you to understand the full impact of such a decision. 因此, this article will provide you with details and insight to consider before moving forward.
How To Determine Whether a Partial Plan Termination Has Been Triggered
而, 一般来说, a partial plan termination occurs when 20 percent or more of employees participating in a defined benefit or defined contribution plan are involuntarily terminated from employment, 没有完美的公式. Plan sponsors are required to review the “facts and circumstances” surrounding reductions in the workforce. 结果是, different rules may apply if the terminated employees work across business lines in an entity or the terminations span more than one plan year.
简单的数学只是一个起点
的 first step in determining the size of the layoff for purposes of a partial plan termination is to take the total number of vested and unvested employees who were involuntarily terminated and divide that number by the number of total plan participants during the applicable period (usually the plan year). However, keep in mind that this calculation is only a starting point. 的 final ruling will be based on the facts and circumstances surrounding the terminations.
只有非自愿终止才适用
Only employees who are terminated for involuntary reasons count toward the partial plan termination trigger. 的 IRS states that routine turnovers and certain spin-offs may not count toward a partial plan termination. 因此, employers may provide evidence to the IRS that shows the turnover rate was not the result of an employer-initiated severance.
Partial plan terminations can be triggered by various reasons
Partial plan terminations can also occur for less obvious reasons, such as when plan amendments exclude employees or adversely affect vesting rights, or when reduced or eliminated future benefit accruals result in a reversion to the employer.
关键:
Plan sponsors who are unsure whether their facts and circumstances trigger a partial plan termination can request a determination letter from the Internal Revenue Service (IRS).
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部分计划终止的后果
Failure to comply with rules and requirements following a partial plan termination can have dire financial consequences for the plan sponsor, 包括取消整个计划的资格, 哪些可能导致重大税务负担和罚款.
When a partial plan termination does occur, affected employees (i.e., those who have been terminated that year) automatically become 100 percent vested in all employer contributions, 包括配对供款. 在一般情况下, a plan will remain qualified only if it makes all employees affected by a partial plan termination whole.
如果发生了使受影响的员工完整的错误, 方法可以修复该错误 美国国税局员工计划合规决议系统 (EPCRS).
设定受益计划和多雇主计划的考虑因素
的 养老金福利担保公司. (PBGC) wants to be informed of reportable events that could trigger a partial plan termination. 的se include when the number of active participants in a plan goes below 80 percent or when operations at a facility stop, 将合格员工的数量减少15%. 的 PBGC needs to be informed of these events so it can prepare for the possibility of having to take over such plans.
Multiemployer plans need to be aware that partial terminations can happen when there is a partial suspension of an employer’s contributions or a 70 percent contribution decline over a three-year period. A variety of calculations are required depending upon the multiemployer plan’s industry and other circumstances, 但70%的门槛是一个很好的指标.
提前计划年终计算和归属支付
Companies often implement layoffs as a way to reduce expenses, but layoffs can lead to some unforeseen expenses of their own. It is important to realize that partial plan terminations can create major cash outflows in the form of vesting payments to affected employees.
而 calculations related to partial plan terminations generally aren’t required until the end of the plan year, you may decide to take the time up front to determine whether their workforce reductions will trigger this event. By preparing for any potential funding requirements, companies may avoid surprise expenses. Employers should carefully review their turnover rates and plan ahead for the possibility of having to fully vest terminated employees.
For additional insight or for assistance determining whether your company is at risk, 接触的意图 & 联营公司退休计划服务团队.
By Darlene Finzer，注册会计师，CSA, QKA (新费城办事处)
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