Author: Nikki Brown – Corporate Director of Accounting
Did You Know Part-Time Employees Can Now Participate in Harmony Hospitality’s 401(k) Plan?
As part of the SECURE Act of 2019, a significant change has made it easier for part-time employees to access their company’s 401(k) plan. This update opens up retirement savings opportunities for a wider group of workers, particularly as more employees seek flexible work arrangements. Long-term part-time employees are increasingly interested in retirement options like 401(k) plans, and understanding eligibility is key to securing a stable financial future.
Eligibility Criteria:
- Age: Must be 21 years or older
- Work Hours: Employees must work at least 500 hours per year for two consecutive years (this was previously three years, prior to January 1, 2025).
- Company Policy: Employers must offer 401(k) plans and comply with the law, although there may be specific rules regarding contributions or matching.
- Vesting Schedule: While employees may be eligible to contribute to a 401(k) after meeting the hours requirement, the contributions are subject to a vesting schedule. This
Key Benefits:
- Retirement Savings: Help build long-term financial security.
- Employer Contributions: Harmony offers a safe harbor 401(k) plan with matching contributions to boost your retirement savings. The matching contribution is up to 4% of your compensation. For example: if you contribute 2% of your paycheck, then Harmony will contribute another 2% which will allow you to save a total of 4%.
- Tax Benefits: Contributions to a 401(k) plan reduce taxable income, providing potential tax savings.
If you’ve been with Harmony for several years but work part-time hours, this change offers a valuable opportunity to start saving for retirement. If you’re a long-term part-time worker, check with HR to confirm your eligibility for 401(k) enrollment and take full advantage of this important benefit.
Start planning for your future as we enter the New Year!
