Title 29 — LaborRelease 119-73
§1052 Minimum participation standards
Title 29 › Chapter CHAPTER 18— - EMPLOYEE RETIREMENT INCOME SECURITY PROGRAM › Subchapter SUBCHAPTER I— - PROTECTION OF EMPLOYEE BENEFIT RIGHTS › Subtitle Subtitle B— - Regulatory Provisions › Part part 2— - participation and vesting › § 1052
Summary
Sets minimum rules for when workers must be allowed to join a pension plan. A plan cannot make an employee wait past the later of age 21 or completing 1 year of service to join. If a plan gives full, nonforfeitable benefits after no more than 2 years, the service wait can be 2 years instead of 1. For certain tax-exempt educational employers with plans that give full benefits after 1 year, the age limit can be 26 instead of 21. Plans also cannot exclude people just because of their age. A “year of service” is generally a 12-month period with at least 1,000 hours of work (special rules apply for seasonal work and for maritime work, where 125 days counts as 1,000 hours). Once an employee meets the age and service rules, they must start participating no later than the earlier of the first day of the next plan year or 6 months after meeting the rules. All years with the employer count for service unless specific break-in-service rules apply. If an employee has a 1-year break before meeting the rules, earlier service may not have to be counted. After a break, past service usually won’t count until the employee finishes another year after returning. Very long runs of 1-year breaks can let the plan ignore earlier service for nonvested workers. Time off for pregnancy, birth, adoption, or caring for a new child must be credited as hours the person would have worked (or 8 hours per day if unknown), with rules about which year those hours count and the plan may ask for proof. Special limits apply for 401(k) and 403(b) arrangements: they cannot delay participation beyond the basic age/service rule (ignoring the 2-year exception) or beyond a 24-month test made of two consecutive 12-month periods with at least 500 hours each and meeting the age requirement; some tax-code exceptions and timing rules also apply.
Full Legal Text
Title 29, §1052
Labor — Source: USLM XML via OLRC
(a)(1)(A)No pension plan may require, as a condition of participation in the plan, that an employee complete a period of service with the employer or employers maintaining the plan extending beyond the later of the following dates—
(i)the date on which the employee attains the age of 21; or
(ii)the date on which he completes 1 year of service.
(B)(i)In the case of any plan which provides that after not more than 2 years of service each participant has a right to 100 percent of his accrued benefit under the plan which is nonforfeitable at the time such benefit accrues, clause (ii) of subparagraph (A) shall be applied by substituting “2 years of service” for “1 year of service”.
(ii)In the case of any plan maintained exclusively for employees of an educational organization (as defined in section 170(b)(1)(A)(ii) of title 26) by an employer which is exempt from tax under section 501(a) of title 26, which provides that each participant having at least 1 year of service has a right to 100 percent of his accrued benefit under the plan which is nonforfeitable at the time such benefit accrues, clause (i) of subparagraph (A) shall be applied by substituting “26” for “21”. This clause shall not apply to any plan to which clause (i) applies.
(2)No pension plan may exclude from participation (on the basis of age) employees who have attained a specified age.
(3)(A)For purposes of this section, the term “year of service” means a 12-month period during which the employee has not less than 1,000 hours of service. For purposes of this paragraph, computation of any 12-month period shall be made with reference to the date on which the employee’s employment commenced, except that, in accordance with regulations prescribed by the Secretary, such computation may be made by reference to the first day of a plan year in the case of an employee who does not complete 1,000 hours of service during the 12-month period beginning on the date his employment commenced.
(B)In the case of any seasonal industry where the customary period of employment is less than 1,000 hours during a calendar year, the term “year of service” shall be such period as may be determined under regulations prescribed by the Secretary.
(C)For purposes of this section, the term “hour of service” means a time of service determined under regulations prescribed by the Secretary.
(D)For purposes of this section, in the case of any maritime industry, 125 days of service shall be treated as 1,000 hours of service. The Secretary may prescribe regulations to carry out the purposes of this subparagraph.
(4)A plan shall be treated as not meeting the requirements of paragraph (1) unless it provides that any employee who has satisfied the minimum age and service requirements specified in such paragraph, and who is otherwise entitled to participate in the plan, commences participation in the plan no later than the earlier of—
(A)the first day of the first plan year beginning after the date on which such employee satisfied such requirements, or
(B)the date 6 months after the date on which he satisfied such requirements,
(b)(1)Except as otherwise provided in paragraphs (2), (3), and (4), all years of service with the employer or employers maintaining the plan shall be taken into account in computing the period of service for purposes of subsection (a)(1).
(2)In the case of any employee who has any 1-year break in service (as defined in section 1053(b)(3)(A) of this title) under a plan to which the service requirements of clause (i) of subsection (a)(1)(B) apply, if such employee has not satisfied such requirements, service before such break shall not be required to be taken into account.
(3)In computing an employee’s period of service for purposes of subsection (a)(1) in the case of any participant who has any 1-year break in service (as defined in section 1053(b)(3)(A) of this title), service before such break shall not be required to be taken into account under the plan until he has completed a year of service (as defined in subsection (a)(3)) after his return.
(4)(A)For purposes of paragraph (1), in the case of a nonvested participant, years of service with the employer or employers maintaining the plan before any period of consecutive 1-year breaks in service shall not be required to be taken into account in computing the period of service if the number of consecutive 1-year breaks in service within such period equals or exceeds the greater of—
(i)5, or
(ii)the aggregate number of years of service before such period.
(B)If any years of service are not required to be taken into account by reason of a period of breaks in service to which subparagraph (A) applies, such years of service shall not be taken into account in applying subparagraph (A) to a subsequent period of breaks in service.
(C)For purposes of subparagraph (A), the term “nonvested participant” means a participant who does not have any nonforfeitable right under the plan to an accrued benefit derived from employer contributions.
(5)(A)In the case of each individual who is absent from work for any period—
(i)by reason of the pregnancy of the individual,
(ii)by reason of the birth of a child of the individual,
(iii)by reason of the placement of a child with the individual in connection with the adoption of such child by such individual, or
(iv)for purposes of caring for such child for a period beginning immediately following such birth or placement,
(B)The hours described in this subparagraph are—
(i)the hours of service which otherwise would normally have been credited to such individual but for such absence, or
(ii)in any case in which the plan is unable to determine the hours described in clause (i), 8 hours of service per day of such absence,
(C)The hours described in subparagraph (B) shall be treated as hours of service as provided in this paragraph—
(i)only in the year in which the absence from work begins, if a participant would be prevented from incurring a 1-year break in service in such year solely because the period of absence is treated as hours of service as provided in subparagraph (A); or
(ii)in any other case, in the immediately following year.
(D)For purposes of this paragraph, the term “year” means the period used in computations pursuant to subsection (a)(3)(A).
(E)A plan may provide that no credit will be given pursuant to this paragraph unless the individual furnishes to the plan administrator such timely information as the plan may reasonably require to establish—
(i)that the absence from work is for reasons referred to in subparagraph (A), and
(ii)the number of days for which there was such an absence.
(c)(1)A pension plan that includes either a qualified cash or deferred arrangement (as defined in section 401(k) of title 26) or a salary reduction agreement (as described in section 403(b) of title 26) shall not require, as a condition of participation in the arrangement or agreement, that an employee complete a period of service with the employer (or employers) maintaining the plan extending beyond the close of the earlier of—
(A)the period permitted under subsection (a)(1) (determined without regard to subparagraph (B)(i) thereof); or
(B)the first 24-month period—
(i)consisting of 2 consecutive 12-month periods during each of which the employee has at least 500 hours of service; and
(ii)by the close of which the employee has met the requirement of subsection (a)(1)(A)(i).
(2)Paragraph (1)(B) shall not apply to any employee described in section 410(b)(3) of title 26.
(3)In the case of employees who are eligible to participate in the arrangement or agreement solely by reason of paragraph (1)(B), or by reason of such paragraph and section 401(k)(2)(D)(ii) of title 26, the rules of subsection (a)(4) shall apply to such employees.
(4)For purposes of this subsection, 12-month periods shall be determined in the same manner as under the last sentence of subsection (a)(3)(A), except that 12-month periods beginning before January 1, 2023, shall not be taken into account.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
Amendments
2022—Subsec. (c). Pub. L. 117–328 added subsec. (c). 1989—Subsec. (a)(1)(B)(i). Pub. L. 101–239, § 7861(a)(2), made technical correction to directory language of Pub. L. 99–514. See 1986 Amendment note below. Subsec. (a)(1)(B)(ii). Pub. L. 101–239, § 7894(c)(2)(A), substituted “educational organization” for “educational institution”. Pub. L. 101–239, § 7891(a)(1), substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”, which for purposes of codification was translated as “title 26” thus requiring no change in text. Subsec. (a)(2). Pub. L. 101–239, § 7892(a), struck out comma after “specified age”. Subsec. (b)(2). Pub. L. 101–239, § 7894(c)(2)(B), substituted “a plan” for “the plan”. 1986—Subsec. (a)(1)(B)(i). Pub. L. 99–514, as amended by Pub. L. 101–239, § 7861(a)(2), substituted “2 years of service” for “3 years of service” in two places. Subsec. (a)(2). Pub. L. 99–509 substituted a period for “unless— “(A) the plan is a— “(i) defined benefit plan, or “(ii) target benefit plan (as defined under
Regulations
prescribed by the Secretary of the Treasury), and “(B) such employees begin employment with the employer after they have attained a specified age which is not more than 5 years before the normal retirement age under the plan.” 1984—Subsec. (a)(1). Pub. L. 98–397, § 102(a), substituted “21” for “25” in subpar. (A)(i) and “ ‘26’ for ‘21’ ” for “ ‘30’ for ‘25’ ” in subpar. (B)(ii). Subsec. (b)(4). Pub. L. 98–397, § 102(d)(1), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “In the case of an employee who does not have any nonforfeitable right to an accrued benefit derived from employer contributions, years of service with the employer or employers maintaining the plan before a break in service shall not be required to be taken into account in computing the period of service for purposes of subsection (a)(1) if the number of consecutive 1-year breaks in service equals or exceeds the aggregate number of such years of service before such break. Such aggregate number of years of service before such break shall be deemed not to include any years of service not required to be taken into account under this paragraph by reason of any prior break in service.” Subsec. (b)(5). Pub. L. 98–397, § 102(e)(1), added par. (5).
Statutory Notes and Related Subsidiaries
Effective Date
of 2022 AmendmentAmendment by Pub. L. 117–328 applicable to plan years beginning after Dec. 31, 2024, see section 125(f)(1) of Pub. L. 117–328, set out as a note under section 401 of Title 26, Internal Revenue Code.
Effective Date
of 1989 AmendmentAmendment by section 7861(a)(2) of Pub. L. 101–239 effective as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 7863 of Pub. L. 101–239, set out as a note under section 106 of Title 26, Internal Revenue Code. Amendment by section 7891(a)(1) of Pub. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 7891(f) of Pub. L. 101–239, set out as a note under section 1002 of this title. Pub. L. 101–239, title VII, § 7892(c), Dec. 19, 1989, 103 Stat. 2447, provided that: “Any amendment made by this section [amending this section and section 1082 of this title] shall take effect as if included in the provision of the Omnibus Budget Reconciliation Act of 1987 [Pub. L. 100–203, probably should refer to Omnibus Budget Reconciliation Act of 1986, Pub. L. 99–509] or Pension Protection Act [Pub. L. 100–203, §§ 9302–9346, probably should refer to Omnibus Budget Reconciliation Act of 1987, Pub. L. 100–203] to which such amendment relates.” Amendment by section 7894(c)(2) of Pub. L. 101–239 effective, except as otherwise provided, as if originally included in the provision of the Employee Retirement Income Security Act of 1974, Pub. L. 93–406, to which such amendment relates, see section 7894(i) of Pub. L. 101–239, set out as a note under section 1002 of this title.
Effective Date
of 1986
Amendments
Amendment by section 1113(e)(3) of Pub. L. 99–514 applicable to plan years beginning after Dec. 31, 1988, with special rule for plans maintained pursuant to collective bargaining agreements ratified before Mar. 1, 1986, and not applicable to employees who do not have 1 hour of service in any plan year to which the amendment applies, see section 1113(f) of Pub. L. 99–514, as amended, set out as a note under section 411 of Title 26, Internal Revenue Code. Amendment by Pub. L. 99–509 applicable only with respect to plan years beginning on or after Jan. 1, 1988, and only with respect to service performed on or after such date, see section 9204 of Pub. L. 99–509, set out as an Effective and Termination Dates of 1986
Amendments
note under section 623 of this title.
Effective Date
of 1984 AmendmentAmendment by Pub. L. 98–397 applicable to plan years beginning after Dec. 31, 1984, except as otherwise provided, see section 302 and 303 of Pub. L. 98–397, set out as a note under section 1001 of this title.
Regulations
Secretary of Labor, Secretary of the Treasury, and Equal Employment Opportunity Commission each to issue before Feb. 1, 1988, final
Regulations
to carry out
Amendments
made by Pub. L. 99–509, see section 9204 of Pub. L. 99–509, set out as an Effective and Termination Dates of 1986 Amendment note under section 623 of this title. Secretary authorized, effective Sept. 2, 1974, to promulgate
Regulations
wherever provisions of this subchapter call for the promulgation of
Regulations
, see section 1031 of this title. Plan
Amendments
Not Required Until January 1, 1989For provisions directing that if any
Amendments
made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of Title 26, Internal Revenue Code. For provisions directing that if any
Amendments
made by Pub. L. 99–509 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 9204 of Pub. L. 99–509, set out as an Effective and Termination Dates of 1986 Amendment note under section 623 of this title.
Reference
Citations & Metadata
Citation
29 U.S.C. § 1052
Title 29 — Labor
Last Updated
Apr 6, 2026
Release point: 119-73