Does my employer have to make elective 401(k) contributions for me if they messed up and didn't take any deductions from my paycheck this year? If so, how much? (You are not my HR professional or ERISA lawyer.)
I just learned that my company has not taken out any money from my paycheck for my 401(k) this year, even though I elected during open enrollment to max out my contributions (to $16,500). I have always maxed out my contributions in the years that I have been here; I usually choose a percentage of earnings that I know will get me to the maximum as close as I can to the end of December. Apparently when I reached the maximum contribution last year the deductions stopped, and through a payroll glitch they never started again in the new calendar year. At this point, I would have put in about $9750 if they had continued. I have put in $0.
With only 5 months of pay left this calendar year, if they take super high deductions each pay period I could still make it to $16,500, but my take home pay would take a noticeable hit. Our payroll person who told me about the glitch said that they were "talking to ERISA counsel" about what contributions were required on their side. That led me to this site
and this IRS publication
, but I can't really understand the conclusions drawn.
So, assuming that the company clearly acknowledges that this was their error (which to this point they do), what is their responsibility here?
(Yes, I theoretically could/should have noticed on my paycheck that they were not making this deduction, and I do look at my paycheck when it comes, but I just never realized that it was not there. I mean really, how often do you look at a man's shoes?)