Union retirement plans are eligible for special coverage and non-discrimination testing rules. However, being a union retirement plan
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is not a state of mind. It is not sufficient for an employer to sit down with a leader from the employees and come to an agreement about the employee’s retirement benefits. There are specific requirements for a plan to be considered collectively bargained and a union plan:
- The employees must be included in a bargaining unit such as a union.
- Retirement benefits must have been the subject of good faith bargaining.
- The Secretary of Labor must approve the agreement.
- A plan that covers more than 2% of professional employees is not considered a union plan.
- The plan must benefit primarily non-owners.