The percentage of pay that is deferred when an employee is enrolled in a plan through its automatic enrollment feature. Participants can generally choose to defer an amount other than the default percentage. The practice of enrolling all eligible employees in a plan and beginning participant deferrals without requiring the employees to submit a request to participate. Plan design specifies how these automatic deferrals will be invested. Employees who do not want to make deferrals to the plan must actively file a request to be excluded from the plan.
Participants can generally change the amount of pay that is deferred and how it is invested.
Beneficiary A person, persons or trust designated to receive the plan benefits of a participant in the event of the participant s death. A type of profit sharing or stock bonus plan in which employees may defer current pre-tax compensation. Cash or Deferred Election A participant request to defer compensation, on a pre-tax basis, to a CODA plan. A type of profit sharing plan in which the company makes contributions directly to employees in cash or stock. The process of changing from one service provider to another.