FAQ 246: Multiple plan--Multiple employer plan setup

Problem: We have one client that is a multiple-employer company. There are just over 100 employers participating within this one plan. We test each plan separately (ADP testing, coverage testing, etc.). But the plan provisions are the same for each company since they are adopting into the multiple-employer plan. We thought it would be a good idea to set up a pattern plan with the multiple-employer plan specs. When I set up the pattern plan, do I use the name of the company that is the sponsor of the multiple employer plan, or do you think it would be better to call it Multiple Employer Plan and then when I set up the individual plans under this pattern plan, I give those the separate employer's names?

Solution: With this setup, call the pattern plan "Multiple Employer Plan". The other thing to consider is to put all the employers in one plan, but separate them by location code. You can set up a location table that has their location name as the Employer name. You can then run each of these compliance tests by location by clicking on the "Location Setup" button option, selecting the locations to be included, and then checking the "Selected Locations Consecutively" box on the compliance test setup screen. The restriction in putting them all in one plan, however, is that you cannot use it to calculate multiple eligibilities, vesting, or contribution formulas. If you have that scenario, you would want to stick with your original plan to set them all up on separate plans.