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DEAR WORKFORCE

IDear Workforce-I What's the 1,000-Hour Rule

An explanation of what that means in terms of ERISA.
April 12, 2000
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Related Topics: Retirement/Pensions, Dear Workforce
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Q

Dear Workforce:

Like many other small HR depts, my assistant & I are responsible for all functions under the HR umbrella in my organization. One area is a bit vague to me, and that is the 1000-hour rule. Could you please provide details on this regulation so I can better understand it? (I'm referring to the reg that says if an employee works more than 1000 hours in a year, they should become entitled to benefits.)

A

Dear 1000 Hours:

Under ERISA, employees must be permitted to participate in a plan if they're 21 and have one year of service. The service requirement may be as long as three years, if the employee is immediately vested in all of the employer's contributions.

A year of service in a retirement plan is defined as any 12-month period in which an employee works 1,000 or more hours. That's where the magical 1,000-hour number comes from.

 

SOURCE: 2000 U.S. Master Human Resources Guide, Copyright CCH Incorporated, 1999.

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 The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

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