Review the 401(k) Pension Plan Safe Harbor Information and FAQs

At this time of year, many cooperatives consider adopting the Safe Harbor provision in their 401(k) Pension Plan. If your co-op is among them, be sure to read through the Safe Harbor Overview and Frequently Asked Questions on the Employee Benefits website to learn about the requirements and potential benefits. Safe Harbor is attractive to certain co-ops because with the provision in place, your co-op is deemed to pass the actual deferral percentage (ADP) test. However, there are also certain requirements to be met and the feature could deliver additional benefits, depending on your co-op’s circumstances.

Implementation timeline
The Safe Harbor feature can only be implemented for a January 1 effective date.

If your co-op is interested in the Safe Harbor provision for 2018, contact your field representative now. The benefits compliance team will join the discussion and will work with you to analyze the impact of the change on your plan and answer your questions. If you decide to add the provision to your plan for 2018, you must complete and return a Safe Harbor Adoption Agreement (provided to you by NRECA) and board resolution by Monday, October 16, 2017. You must then distribute a copy of the required Safe Harbor notice to your employees by November 30, 2017 for the 2018 plan year. This notice describes the provision to 401(k) Plan participants, helping them make an informed decision about plan participation. In late October, co-ops with the provision will receive a Message Center notification with a link to the notice and instructions for how to distribute it. Finally, by November 30, you’ll acknowledge distributing the notice through the Employee Benefits website.

If you have questions about the Safe Harbor provision, contact the benefits compliance team at 866.673.2299, option 7, or email us at pension.compliance@nreca.coop.