QOTW: LTPT Hour Tracking

A provision in the SECURE Act passed in 2019 provided for retirement plan eligibility for long-term part-time employees – those that earn at least 500 hours of service in each of three consecutive 12-month periods beginning with the 2021 plan year. This means that at the end of the 2023 plan year, any employees that worked 500 hours in each of 2021, 2022, and 2023 must then be eligible to make deferrals to the plan (employer contributions are not required). We have heard that the tracking of such hours is cumbersome for employers so this week we asked employers if they have put a process into place to start tracking these hours or not. The consensus from respondents seems to be that all part time employees are already eligible to participate, or the plan is amending to allow them so that hours do not need to be tracked. Of those that already allow part time employees to participate, some track hours and some do not. 

Sixty percent are not tracking hours for this provision yet, mostly because they don’t have part-time employees, because part-time workers are already eligible, or because they are already tracking hours through payroll for other reasons:

• All employees are eligible for our plan immediately (but need to meet 1 year prior to getting the employer contribution).
• All employees participate in our plan
• Already allow part time employees to participate in the plan.
• Currently Part time employees can participate in Plan and receive match. No need to track.
• I don't even know about this yet, not sure if it affects my Plan. My recordkeeper usually fishes out what affects my Plan.
• Long term part-time employees are eligible at our company to participate in our plan.
• Long-term part-time employees were already eligible for our plan.
• No need - we don't have any PT employees.
• No part-time employees
• Not necessary, part-time employees are already eligible for our plan.
• Not necessary, we do not require a certain number of hours to participate or receive match.
• Our part time are eligible to participate immediately.
• Our part time employees have always been eligible to participate in our 401k Plan.
• Our part-time employees are eligible to participate in the plan regardless of hours, so no need to track.
• Our plan allows part-time employees to participate currently.
• Our plan doesn't currently have an hours requirement, and part-time employees are already eligible to participate, so there's no need to start counting hours.
• Part time are eligible upon hire.
• Part time employees already qualify for our plan.
• Part-time/full-time is not a consideration in our plan eligibility.
• This provision doesn't affect us.  All employees regardless of FT/PT status are already eligible for the plan once they hit the service requirement.
• We allow all part time employees on the plan
• We allow all part time employees to participate
• We allow PT employees in the plan
• We already allow part-time employees to participate - we don't count hours to determine eligibility.
• We already make PT employees eligible for our plan and we do not generally employ variable hour employees.
• We already permit part-time employees to participate in the 401k plan on their DOH.
• We already run PT hours annually to see if anyone qualifies under the 1000 hour rule, so plan to just adjust our review accordingly
• We already track hours for all employees and all employees are eligible to participate in our 457b plan.  Only exception is temporary employees.
• We are not tracking hours, because we have always allowed long-term part-time employees to participant in our 401(k) Plan.
• we are planning to make them eligible for the plan immediately beginning Jan 1, 2023
• we do not have an hours requirement, provided employees are "regular." If it is important to the bank that we have part-time employees, then we owe them this benefit.
• We do not have any part-time employees.
• We do not have part-time employees
• We do not track hours because we allow all employees, unless in a nonparticipating union or noncompany paid contractor, to participate after 3 months of service.
• We don't have LT part time employees.  We either have FT employees or temps through an agency.
• We don't have PT employees
• We fortunately (!) don't need to track - all employees are eligible to participate immediately.
• We have always treated full and part time W2 employees the same for plan participation eligibility for salary deferrals and matching contributions, completion of 3 consecutive months of employment. Entry date is the 1st day of the plan year quarter coinciding with or next following the date eligibility requirements are satisfied.
• We have no employees that would fall into this category.
• We provide 401k to PT
• We will expand eligibility to PT employees to eliminate the need to track hours.
• would prefer our 401k provider to do this

   

Forty percent stated they have begun tracking hours, though for many part-time workers are already eligible:

• All part-time employees are already eligible for our plan.
• All part-time employees are hourly and are plan eligible so we have been tracking hours through our payroll system.
• Our plan already included an eligibility provision for part-time employees based on age and hours, so we have been doing this.
• Part Time employees are eligible for participation
• Part time employees can already participate in our plan.
• We allow all employees full-time and part-time to participate the 1st Q after 6 months of employment
• We allow part-time employees in our plan, so hours tracking for that purpose is not necessary.  We do track participant hours for other purposes already.
• We already allow part-time employees to participate in our plan.
• We don't have any part time workers
• We have all employees tracked for the plan participation.
• We have always allowed part-time employees to participate in the plan, but we do not track their hours. Only temporary employees are ineligible unless they have met the minimum required hours.
• We have done this for years, only 2 people part-time, so not a problem
• We have tracked in the past but because we have so few part-time employees we decided to amend the plan to make them immediately eligible for the 401k.
• We track hours but are still working with our administrator to determine eligibility.
• We've always been able to track hours for long term part-timers with Workday HRIS but decided to treat part-timers the same as full-time so tracking won't be necessary.
• We've always tracked all hours for all employees