Unique Eligibility Cases
for the 401(a) Retirement Plan

If an employee previously participated in the 401(a) Retirement Plan, then eligibility depends on the vesting status of their YMCA Account when they left their previous Y employer.

Employees are always vested in:

• Personal Account
• Additional Y Account

If they have an Additional Y Account, participation resumes immediately—regardless of time away.

There are certain circumstances prior to July 2009 in which a YMCA contributed to an employee’s Personal Account which could require participation to resume immediately. 

1. How long they were away, and
2. Whether they had enough service to qualify before they left
   

Scenarios

Return within 6 Years:

• Any prior 12-month period with 1,000 or more hours counts toward eligibility.
• Prior months of employment count toward vesting and, if the employee was away for less than one year, then the period away may also count towards vesting.

Return after 6 Years:

• Treat as new hire.
• No prior service counts toward eligibility or vesting.

• Enrollment is mandatory for eligible employees unless they meet the criteria to waive participation and you obtained a completed waiver prior to eligibility.
• It is best practice to retain a completed Application to Participate from each eligible employee—and may be mandated under applicable payroll law if your Y requires that employees contribute to the 401(a) Retirement Plan.
• When in doubt, review the Enrollment & Eligibility resources or contact us.

Employees at a Y Newly Adopting the Y Retirement Benefit or
Employees at a Y Acquired or Merged Into a Participating Y

• All prior service of those employed at time of adoption, acquisition or merger counts for eligibility and vesting.
• All eligible employees must be enrolled as a condition of employment. Please inform Y Retirement if employees will be required to contribute and if any employees are age 60 or older, and would like to waive participation.

Employees at a Y That Left the Y Retirement Benefit and Later Rejoined

• Service during the non-participation period counts toward eligibility and vesting once the Y rejoins.

Employees from a Non-Y Organization Acquired by a Participating Y

• Their prior service hours do not count automatically.
• The Y may submit a written request prior to the acquisition date to Y Retirement’s Benefits & Operations Committee if it wants these hours counted.

Leased or Union Employees

• Eligibility depends on federal law and the Y’s specific agreement with Y Retirement.
• Contact us for guidance on these cases.

Unvested Balances, Forfeitures & Returning Employees

If an employee enrolled in the 401(a) Retirement Plan left Y employment before vesting in their YMCA Account balance and then returns:

• Return within 6 years:
  • Participation resumes immediately—even if they withdrew funds or are receiving an annuity.
  • Prior months of employment count toward vesting and, if the employee was away for less than one year, then the period away may also count towards vesting.
• Return after 6 years:
  • Treat as a new hire.
  • Their unvested balance would have been forfeited.
  • They must re-meet eligibility and vesting requirements for future contributions.

Retirees who are receiving a Y Retirement annuity or who withdrew their balances may work for a Y again as long as:

• There was no pre-arranged agreement to retire and keep working, and
• The work they perform complies with Y Retirement rules on post-retirement employment.

Administrators should review Y Retirement’s guidance to ensure compliance.