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City of Portland

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5.09.040 Participation in the Plan.

(Amended by Ordinance Nos. 179417, 182168, 183900, 185726, 186746 and 187574, effective February 10, 2016.)

A.  Eligibility.  Employees shall be eligible to enroll as Participants in the Plan, as provided in this Section, on the first day of the month following the month in which they will have completed 30 days in a paid status. A Participant who terminates his or her employment with the City and then returns to City employment after the expiration of 12 calendar months following said termination date must comply with the eligibility waiting period applicable to such person upon his or her return before being eligible to participate in the Plan again.  A Participant's right to participate and to have his or her salary reduced in connection with the Plan shall cease in the event the Participant takes a leave of absence without pay, but any such Participant may continue full participation in the Plan upon returning to pay status with the City.  A Participant’s right to participate and to have his or her salary reduced in connection with the Plan shall cease while the Participant is receiving distributions in accordance with, and subject to, the restrictions of Sections 5.09.070, 5.09.080, 5.09.090, and 5.09.100. 

B.  Enrollment in the Plan. An eligible Employee may become a Participant and defer Compensation not yet earned by executing a Participation Agreement, and submitting it to the Bureau of Human Resources, Health and Financial Benefits Office in an acceptable format.  Compensation will be deferred for any calendar month only if a Participation Agreement providing for such deferral has been entered into by the 15th of the preceding month.

C.  The Participation Agreement shall be in a format provided by the City, which shall include the following:

1.  The Participant's name;

2.  The dollar amount or percent of Compensation to be deferred;

3.  Other relevant statements necessary and appropriate for carrying out the purposes of this Chapter; and

4.  The investment or deposit preference shall be made in a format provided by the City.

D.  When an eligible Employee executes a Participation Agreement, an Acknowledgement and a Beneficiary Designation shall also be completed. A Participant may change the Beneficiary Designation at any time by completing a new Beneficiary Designation and submitting it to the Bureau of Human Resources, Health and Financial Benefits Office.  A change of Beneficiary Designation shall become effective on the date received by the Bureau of Human Resources, Health and Financial Benefits Office, and must be received prior to the date of death.

E.  The City, upon the request of an eligible Employee, will reduce each pay period the salary of the eligible Employee by an amount of money designated by that Employee in the Employee's Participation Agreement. The City shall pay that amount to the Service Provider designated in the Employee's Participation Agreement.

F.  Once per month, a Participant may modify his or her Participation Agreement as to the amount of Compensation not yet earned to be deferred during each Plan Year.  Any modification as to the amount of Compensation to be deferred by a Participant must be submitted in a format provided by the City, and received by the Bureau of Human Resources, Health and Financial Benefits Office, by the 15th of the month prior to the month in which said modification is to become effective.

G.  A Participant may revoke the Participation Agreement at any time with respect to any pay period by submitting notification in a format provided by the City, which must be received by the Bureau of Human Resources, Health and Financial Benefits Office, prior to the date upon which the Participant desires the revocation to be effective.

H.  Prior to severance from employment with the City, a Participant may make a special election to be processed within their final paycheck of their vacation, comp, and/or holiday pay-out.  A Participant must submit a Participation Agreement before they sever employment and before the amount is available to the employee.  The election can be made as a dollar or percentage amount.  This election will only apply once on the final paycheck issued.  The maximum deferral limits shall apply in accordance with Sections 5.09.050 and 5.09.055.  If not previously elected during the calendar year, the participant may elect the 3-year catch-up provision pursuant to Section 5.09.055.

I.  A Participant who has severed his or her employment or who has revoked the Participation Agreement may again participate in the Plan, provided that he or she is eligible, by submitting a new Participation Agreement.

J.  For purposes of Plan administration, a revocation of a Participation Agreement will be considered a Participation Agreement modification. The most recent Participation Agreement shall be controlling with respect to all accounts, including amounts deferred under prior agreements.

K.  Automatic Enrollment in the Plan.

1.  Collective Bargaining Agreements requiring Automatic Enrollment.

a.  If the City and a labor organization representing a unit of City employees agree in collective bargaining, the Eligible Employees in such bargaining unit will be automatically deemed to have executed a Participation Agreement. With respect to then currently Eligible Employees such deemed executed Participation Agreement will be effective commencing with the payroll period designated in such collective bargaining agreement. If no payroll period is designated in the collective bargaining agreement, the Participation Agreement will be effective the first payroll period after the effective date of such collective bargaining agreement.

b.  New Eligible Employees who are covered by such a collective bargaining agreement will be automatically deemed to have executed a Participation Agreement effective for the first payroll period in which they could complete a Participation Agreement, unless another date is specified in the applicable collective bargaining agreement.

c.  Notwithstanding the preceding in this Section, the deemed executed Participation Agreement will not be effective prior to the time described in the required notice described in Subsection 5.09.040 K. 2.

2.  Advance Notice.  An Eligible Employee will be provided the required advance notice of automatic enrollment pursuant to IRC Section 414(w), including the amount of contributions that will be made, the employee’s right to elect to not have automatic contributions made, a description of how the contributions will be invested, and when such contributions may be distributed.  The notice shall be provided within a reasonable period before each Plan Year or before such other time when the automatic provision will first become applicable to an Eligible Employee.

a.  Opting Out of Automatic Enrollment.  A Participant shall have the right to opt out of automatic enrollment at any time by completing a Participation Agreement or by providing notice of the election to not have any amount withheld from his or her Compensation.

b.  Deferral Amount.  The amount deferred from an Eligible Employee’s Compensation shall be the amount specified in the applicable collective bargaining agreement, provided that the requirements of IRC Section 414(w) are satisfied, including the requirement that the percentage of pay deferred will be uniform for employees with the same years of employment, and the applicable minimum and maximum deferral percentages.