Expert: Allen - 5/11/2006

Question
Couple of followup questions:
1) Shouldn't the plan documents contain some clause to that effect (employed as of last day of plan year)?
2) The other former employees I speak of were employed through November of 2005... well past the last day of the plan year. Any thoughts on them?
Thanks!
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Followup To
Question -
If the SPD of my 401k/profit-sharing plan states that employer profit-sharing contributions to the account are discretionary, does that entitle the employer to make profit-sharing contributions to specific employees only?  
My firm makes profit-sharing contributions to the 401k plan in December, for the time period 6/1-5/31 (i.e. 12/04 - contribution was for 6/1/03-5/31/04). When reviewing my 401k statement for December 05, there was no employer contribution.  I questioned the plan administrator, who told me there was NO profit-sharing contribution for 5/31/05. When I double-checked that with a current employee of the firm (I am no longer employed by the firm (eff 5/24/05)), she provided me with an email that the plan administrator had sent to current employees, stating the 5/31/05 profit sharing contribution was 3.5% and that employees had the choice of receiving this sum in cash (through payroll) or deferral (401k contribution).  There were at least three employees that left the firm during 2005, and none of them received these profit-sharing contributions.  
Does my former employer have the right to do this? Is there any regulation on employer contributions? Is this behaviour illegal, or just plain unethical?
Answer -
Plan can require employment on the last day of the plan year to receive a portion of the contribution.

Answer
To respond to your followup questions:
1. The last day requirement MUST be in the plan document. It probably should also be in the Summary Plan Description which should have been given to you when you became a participant. If you are still a participant (still have money in the plan) you can examine a copy of the plan document at the plan administrator's office. You may also be able to purchase a copy of the document. If you've been paid out, then you are no longer a participant and they do not have to let you examine the plan or purchase a copy. However, you can get a friend who still works there do this for you.
2.In this case, my explanation may not be correct. I would check with the Plan Administrator. If you are not satisfied with the response, you can contact the local office of the U.S. Dept. of Labor (Employee Benefits Security Administration Division) and they may be able to help you.
Good luck.