Hewitt翰威特咨询给美国某大机构的HR法律咨询案

ProblemsandIssueswithNondiscriminationRules-CaseStudiesMarch18,2003Toprotecttheconfidentialandproprietaryinformationincludedinthismaterial,itmaynotbedisclosedorprovidedtoanythirdpartieswithouttheapprovalofyourorganizationandHewittAssociatesLLC2Agenda•ControlledGroupIssues•PlanAggregationIssues•DeterminationofHCEs•DeterminationofMostValuableAccrualRatesControlledGroupIssues4GroupstoInclude•Whoknowsthegroup?•Arethereleasedemployees?•Arethereaffiliatedservicegrouprelations?•Arethereacquisitions?5Issue1:Whoknowsthecontrolledgroup?Essentialtoinvolvelegalcounsel•HRcontactsmaynotknow–whetherornottheyhaveaparentorsub–percentageofownershipiftheydo–thatforeignparentownsotherU.S.companies–whetherbusinessrelationshipsconstituteanaffiliatedservicegrouporleasingarrangement•Requiresinterpretationsofcorporatelaw•WEDONOTPRACTICELAW6Issue1:Whoknowsthecontrolledgroup?ABCDEFGHKJIUSAUSAUSAUSAUSAUSAUSAUSAFranceFranceCanadaAcquires80%100%80%40%40%50%50%-acquiredprioryear85%0%-Leasinggrp0%-MgtSvcsonly0%-SvcsonlyExercise:Identifycontrolledgroupsinyears0,1,and2,assumingacquisitionsadmittedtocontrolledgroupatendoftransitionperiod7Issue1:Whoknowsthecontrolledgroup?Situation:Companywithforeignownership•Family,Inc.familycompanyownerretiring•SellstoNewDad,Inc.,alargeEuropeancompanysochildrendon’ttakeover•Family,Inc.checksandfindsotherUScompaniesownedbyNewDadtoincludeintesting•LaterFamily,Inc.findsthatNewDad’sCanadiansubsidiaryalsoownsadditionalUSentitiestoincludeintesting,butwondersaboutfindingothers8Issue1:Whoknowsthecontrolledgroup?Situation:Holdingcompany•AllAloneCompanyisacquiredbyaholdingcompany(HoldMyHandButPretendI’mNotHere,Inc.)•AllAloneishappyitstillgetstomaintainitsownplans,payroll,doitsownfilings•But,nowAllAlonemustfigureoutwhoelseHoldMyHandownsandhowtocollectdatafromwhoinordertodoitstesting9Issue2:Arethereleasedemployees?Leasingarrangements•Consideredleasedemployeeif–provideservicespursuanttoanagreement–servicesperformedsubstantiallyfulltimeforatleastayear–servicesprovidedunderdirectionofrecipientemployer–notcoveredbyasafeharborretirementplan10Issue2:Arethereleasedemployees?Situation:Typicalleasingarrangements•InNDTplanningmeeting,WhoMe,Lease?Co.statestheyhaveonly3leasedemployees–jokespassingasmallgroupinthehallthatwehadjustpassedalltheirleasedemployees•Afterreviewingaleasedemployeechecklist,WhoMeLeasecallsbackwith200leasedemployees–sincethecontrolledgrouphadonly2000NHCEsbefore,the75%ratiotestchangesto68%andnowrequiresanaveragebenefitpercentagetest11Issue2:Arethereleasedemployees?Situation:CompanyemployeesworkatJV•DivisionJisownedbyBiggerFishCompany•BiggerFishCompanyspinsoffDivisionJtoformajointventure•DivisionJemployeesbecomeemployeesoftheJV•BiggerFishCompanyalsohasafewemployeeswhoremainBigFish,butworkattheJV–theseemployeesaretestedasemployeesbyBiggerFish,butalsomustbeincludedasleasedemployeesbytheJV12Issue2:Arethereleasedemployees?Situation:Companyacquiresemployees•WeDoEverything,Inc.acquirestheofficestaff,theirportionoftheretirementplan,andthewholebuildingoftheWeDon’tDoFloorsCo.•TheprofessionalstaffofWeDon’tcontinuestoworkinthebuilding&controltheworkoftheofficestaff•WeDoteststheofficestaffasemployees•WeDon’tincludestheofficestaffasleased–aggregatesofficeplanasifitsown13Issue3:Arethereaffiliatedservicegroups?AffiliatedServiceGroups•Noownershipinvolved,basedinpartonregularprovisionofservicesormanagementservicesbyaserviceorganization•Don’tforgetaffiliatedservicegroupsofaffiliatedservicegroups•IRSwillruleviaForm5300filingwhetheranaffiliatedservicegrouprelationshipexists14Issue3:Arethereaffiliatedservicegroups?Situation:Companyacquiresemployees-2•WeDoWindows,Inc.acquirestheofficestaff,theirportionoftheretirementplan,andthewholebuildingoftheWeDon’tDoWindowsCo.•TheprofessionalstaffofWeDon’tcontinuestoworkinthebuilding&controltheworkoftheofficestaff•Anaffiliatedservicegrouprelationshipexists•WeDoandWeDon’taretestedasonecontrolledgroup15Issue3:Arethereaffiliatedservicegroups?Situation:Attorneysdisagree•WeDoEverything,Inc.nowacquiresWeDoWindows,Inc.•Theaffiliatedservicegrouprelationshipiscausingitsplantofailunderthenewcontrolledgroup•TheattorneyforWeDoWindowsthinksitshouldpasssincetheyfeeltherelationshipwithWeDon’tDoFloorsshouldalsobeanaffiliatedservicegroup•TheattorneyforWeDoEverythingdisagrees16Issue4:Whataboutacquisitions?Transitionruleapplication•Notmuchguidance•Generallyagreedthetransitionrulecan’tbereliedontoavoidtestingindefinitelyiffrequentM&A–someattorneyssuggesttestingthecompanyanditsacquisitionasseparatecontrolledgroupsuntiltheendofthetransitionperiod–somesuggesttestingthecompanyonlywithoutitsacquisitionuntiltheendofthetransitionperiod–someignorethetransitionrule17Issue4:Whataboutacquisitions?Situation:Separatetestingduringtransition•AllTogetherNow,Inc.acquiresNotQuiteTogetherYet,Inc.andinstructsNotQuiteTogethertocontinuetestingasusualuntiltransitionends•NotQuiteTogethertestsitsmultipleemployerplan–planprovidescutstoHCEs•Aftertransition,AllTogetherNowattorneygetsinvolvedintestinganddeterminesthereisasingleemployer,notmult