Before you can begin contributing to your 401(k) plan, you must first meet your employer’s eligibility requirements. These rules vary by plan and can apply differently to each contribution source.

Who This Applies To

This information applies to employees and participants who want to understand when they can start contributing to their company’s 401(k) plan or roll over funds from a previous plan.

How to Check Your Plan’s Eligibility Rules

To find out when you can start participating in your company’s 401(k) plan:

  1. Reach your to your Employer/Plan Administrator for a copy of the Summary Plan Description (SPD). This will tell you what the plan's eligibility requirements are.

SECURE Act 2.0: Long-Term Part-Time (LTPT) Employee Eligibility

Under SECURE Act 2.0, part-time employees who do not meet their plan’s standard eligibility requirements may still become eligible to contribute to the plan if they:

  • Work at least 500 hours in each of two consecutive years, and
  • Meet the plan’s minimum age requirement (typically age 21)

This rule applies to employee elective deferrals only—not to employer contributions.

Important Details for LTPT Eligibility

  • If you qualify under the LTPT rule, you may make salary deferrals but are not eligible for employer contributions until you meet your plan’s full eligibility requirements (e.g., 1,000 hours of service in a 12-month period).
  • If you later meet the standard eligibility rules, you may then become eligible for employer contributions.
  • Vesting credit toward employer contributions begins with your LTPT service. Even if you weren’t eligible for employer contributions while part-time, those years still count toward vesting once you become eligible.
  • Vesting for LTPT employees is based on completing at least 500 hours of service in a plan year.
  • Elective deferrals (your own contributions) are always 100% vested, regardless of hours worked.

Example:

Jane works more than 500 hours in both 2023 and 2024 and meets the age requirement. She becomes eligible to make employee contributions as of January 1, 2025, under the LTPT rule. If she later works 1,000 hours in 2025, she may become eligible for employer contributions in 2026. Her 2023 and 2024 service will count toward vesting in any employer contributions she later receives.

What Happens When You Meet Eligibility Requirements

Once you meet your plan’s eligibility requirements, we’ll send you an enrollment invitation by email so you can register your account and begin participating in the plan.

The timing of this notification depends on your plan’s specific eligibility rules:

If Your Plan Allows Immediate Eligibility

  • You’ll receive an enrollment invitation as soon as your information is entered into our system—there is no waiting period.

If Your Plan Has a Delayed Eligibility Rule

  • For plans that include service requirements (such as 1 year of employment and/or 1,000 hours worked), we aim to send your enrollment invitation 30 days before your eligibility date.
  • However, there is an exception to the 30-day notification policy:
    • If your plan requires 1,000 hours of service and you haven’t yet met that requirement by the 30-day notice point, we’ll delay your invitation until the requirement is met.

Example:

  • Your hire date is December 1, 2024
  • Your plan requires 1,000 hours of service within the first 12 months
  • Normally, you’d be notified on November 1, 2025 (30 days prior)
  • But if you haven’t reached 1,000 hours by that date, we won’t send the invitation
  • If you meet the 1,000-hour threshold on November 15, 2025, we’ll send the invitation shortly after that

This ensures that you aren’t invited to enroll until your eligibility is fully confirmed.

Rollover Contributions Before Eligibility

You may be allowed to roll funds into the plan from a previous employer’s retirement plan or pre-tax IRA before meeting eligibility requirements for new contributions.

Important Notes:

  • Rollover funds will be invested in the plan’s Qualified Default Investment Alternative (QDIA) unless you complete enrollment and select your investments.
  • You will receive an enrollment invitation 30 days prior to your eligibility date.
  • If your plan allows immediate eligibility, you’ll receive an enrollment invitation once your information is entered into the system.

To initiate a rollover before you're eligible, please email us at info@myubiquity.com or chat with us online. We’ll provide the appropriate rollover form and instructions.

How to Ensure Accurate Eligibility Calculation

If you believe you’ve met your plan's eligibility requirements but have not received an enrollment email, please contact us to confirm that the following information has been entered correctly in our system:

  • Your date of birth
  • Your date of hire
  • Your hours worked 

If any of this information is missing or incorrect, you’ll need to reach out to your Employer/Plan Administrator and ask them to update your records in our system. Accurate data entry is essential to ensure you are enrolled at the correct time.

Still Have Questions?

If you're unsure whether you’ve met your plan’s eligibility requirements or need help understanding your hours worked, contact your HR department or plan administrator.

If you have questions, email us at info@myubiquity.com or chat with us 24/7.