Premium Reduction Option Plan
Salary Reduction Disclosure
You have elected to participate in your employer’s Cafeteria Plan called ProPlan 125 and have agreed to participate in the benefits incorporated by ProPlan 125 as shown on your Salary Reduction Agreement. The term of ProPlan 125 is for one year, commencing on the date stated on your Salary Reduction Agreement and terminating twelve months later. Your participation in ProPlan 125 will be automatically renewed for the subsequent Plan Year unless you notify your employer prior to subsequent years, you will be given the opportunity to cancel your participation or to change your benefit election(s) for the coming year. If you do not complete and return a new election form canceling your participation or changing your benefits in the time and manner prescribed by the Plan Administrator, your current benefit coverage as stated in this Disclosure and your Salary Reduction Agreement will be extended for one year and the required contributions to cover said benefit coverage will continue. Any previous Salary Reduction Agreement under any compensation plan relating to any or the same specified fringe benefits is hereby revoked.
By participating in the ProPlan 125 Cafeteria Plan, you authorize your employer to reduce your gross compensation in the amounts listed on the Salary Reduction Agreement you signed. The benefit election amounts will be adjusted automatically pursuant to any premium changes rendered by the vendor.
You understand that the tax calculations illustrated on the Salary Reduction Agreement are representative of those used by your employer. The actual amount of your taxes will be reflected on your first paycheck after ProPlan 125 takes effect.
The election(s) made on your Salary Reduction Agreement will be in effect for the Plan Year and cannot be revoked unless you experience a change in your family status (such as, marriage, divorce, death of a spouse or child, birth or adoption of a child, or change of employment status of either you or your spouse). Any revocation allowed by reason herein will only be effective prospectively.
The Plan Administrator may reduce or cancel the amount of your pay reduction or otherwise modify your Salary Reduction Agreement in accordance with the provisions in the ProPlan 125 document if they believe it is advisable in order to satisfy certain provisions of the Internal Revenue Code.
You should understand that by entering into the Salary Reduction Agreement your tax contributions to Social Security will correspondingly be reduced, and this lower tax contribution may reduce your future Social Security benefit. However, you may offset any possible reduction through participation in a Social Security Supplement program if one is offered.
The Salary Reduction Agreement referenced by this Disclosure will automatically terminate if the ProPlan 125 is terminated or discontinued.
This Disclosure statement, the attached Plan Information Summary, and product brochures, tables, charts, and other explanatory materials distributed by the Benefit Providers before and during the enrollment period are intended to satisfy the ERISA Summary Plan Description disclosure requirements referenced by item (3) below.
All participants of ProPlan 125 are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). Under ERISA, plan participants are entitled to:
- - Examine without charge (either at the Plan Administrator’s office or at other specified locations) all plan documents filed by the Plan with the U.S. Department of Labor. This includes insurance contracts and copies of such documents as detailed annual reports and plan descriptions.
- - Obtain copies of all plan documents and other plan information on written request to the Plan Administrator. (Reasonable charges may be made for the copies.)
- - Receive a Summary Plan Description (SPD) proving a non-technical explanation of ProPlan 125, its Benefit Options, advantages, and disadvantages. In the event of any inconsistencies between ProPlan 125 and this Disclosure with its attached Plan Information Summary, the provisions of ProPlan 125 will prevail.
The Salary Reduction Agreement is subject to the terms of ProPlan 125 Document and all the benefit plans incorporated therein as from time to time in effect, and will be governed by and construed in accordance with the laws of the State shown on your Salary Reduction Agreement.