(a) An employer that employs persons to perform creditable service subject to coverage by the plan under this part that offers a deferred compensation plan as described in Section 457 of the Internal Revenue Code may enter into a written contract with the system for services regarding that deferred compensation plan provided by the employer. That contract may include any of the following services: (1) Services to ensure compliance with Section 457 of the Internal Revenue Code regarding the deferred compensation plan including, but not limited to, services that permit the system to do any of the following: (A) Administer and maintain written plan documents governing the employerâs plan. (B) Review and authorize requests for unforeseeable emergency withdrawals, transfer requests, loan requests and other disbursements permitted under Section 457 of the Internal Revenue Code. (C) Review and determine domestic relations orders as qualified domestic relations orders as described in Section 414(p) of the Internal Revenue Code. (D) Provide notice to eligible employees that is consistent with Title 26 of the Code of Federal Regulations that those employees may participate in the deferred compensation plan. (E) Administer and maintain specimen salary reduction agreements for the employer and employees of that employer to initiate payroll deferrals. (F) Monitor, from information provided either directly from the employee, as part of the common remitting services provided pursuant to paragraph (2), through information provided by the employer, or through information provided by vendors authorized by the employer to provide investment products, the maximum contributions allowed by employees participating in the deferred compensation plan as described in Sections 414(v) and 457 of the Internal Revenue Code. (G) Calculate and maintain vesting information for contributions made by the employer to the deferred compensation plan. (H) Identify and notify employees that are required to take a minimum distribution of the funds in that employeeâs deferred compensation plan as described in Section 401(a)(9) of the Internal Revenue Code. (I) Coordinate responses to the Internal Revenue Service if there is an Internal Revenue Service audit of the deferred compensation plan. (2) Services to administer the deferred compensation plan that include, but are not limited to, all of the following: (A) Common remitting services. (B) General educational information to employees about the deferred compensation plan that includes, but is not limited to, the enrollment process, program eligibility, and investment options. (C) Internal reports for the employer to ensure compliance with Section 457 of the Internal Revenue Code and Title 26 of the Code of Federal Regulations. (D) Consulting services related to the design, operation, and administration of the plan. (E) Internal audits, on behalf of an employer, of a providerâs plan compliance procedures with respect to the providerâs custodial account offered under the employerâs plan. These audits shall not be conducted more than once per year for any providerâs plan unless documented evidence indicates a problem in complying with Section 457 of the Internal Revenue Code. (b) The system may contract with a third-party administrator for the administrative and compliance services to employers described in subdivision (a). For purposes of this subdivision, a âthird-party administratorâ shall mean a person or entity other than the system that provides administrative or compliance services as described in subdivision (a). If the system contracts with a third-party administrator, the system shall do all of the following: (1) Determine that hiring a third-party administrator is in the best interest of the participants to the deferred compensation plan, their beneficiaries, and the employer that provides that deferred compensation plan. (2) Require the third-party administrator to provide proof of liability i
‹ Prev All California sections Next ›
Lexace provides legal information, not legal advice, and no attorney–client relationship is created. Statute text is provided for general information and may not reflect the most recent amendments; verify against the official state code.