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URL:  http://boards.fool.com/hi-schauher-you-asked-in-post-29483-is-there-any-14909471.aspx

Subject:  Re: question about 401k Date:  5/5/2001  9:43 AM
Author:  rclyde Number:  29491 of 75601

Hi Schauher:
You asked in post 29483:
Is there any conceivable benefit to the employer by preventing 401k savings.....

I'm not expert, but from my own experience in setting up a 401k Pension Plan, there was a very logical reason to put in a one year qualification date.

I'm in the construction industry and we have a large turnover in employees. We match dollar for dollar, up to 5% and also have a discreationary amount (profit sharing)of another 5%.

By requiring employees to wait one year to join the plan, we eliminating paying all the summer temps the dollar for dollar match and the discreationary amount. Our plan was designed to provide retirement benefits to the carreer employee, not the summer temporary help, who only work for you for 1 or 2 months, then quite and take out in cash the money they have in the plan.

We also put in a 5 year clift vesting schedule, with the idea that if they work 3 or 4 years, the have a tremendous incentive to remain with us.


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