In previous years, part-time employees weren\u2019t eligible to receive the same 401(k) options as full-time employees. Fortunately for part-time workers, times have changed.<\/p>\n\n\n\n
Now, employers can incentivize employee retention and provide part-time employees with the opportunity to plan for their retirement by offering 401(k) enrollment. This is thanks to the Secure Act 2.0, enacted on January 1, 2023.<\/p>\n\n\n\n
Here’s everything you need to know about part-time employee eligibility for enrollment in an employer sponsored 401(k) plan.<\/p>\n\n\n\n
If an employee has worked between 500 and 1,000 hours per year during a three year period, they are considered long-term, part-time employees. These employees are eligible to participate in the employer-sponsored 401(k) plan once they meet the plan’s minimum age. Note than employees who worked 1,000 or more hours in a year would be full-time qualified.<\/p>\n\n\n\n
Though the Secure Act states that employers must provide qualified workers with the option to participate in an employer-sponsored 401(k) by 2024, employers may allow long-term, part-time employees to participate sooner.<\/p>\n\n\n\n
With this change now on the horizon, employers need to be prepared. A few ways employers can get ahead and prepare part-time workers for this opportunity are as follows:<\/p>\n\n\n\n
Gone are the days when only full-time employees were eligible for 401(k) plan participation. Now, companies are choosing (and required) to provide eligible part-time workers with the chance to save for their retirement. Now is the time for employers to inform their employees of their options and for employees to be aware of the eligibility requirements.<\/p>\n\n\n\n
If you have questions about part-time employee eligibility requirements for 401(k) enrollment, don\u2019t hesitate to visit the ePlan Help Center<\/a> or reach out to our support team.<\/p>\n\n\n\n\n