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elaws - employment laws assistance for workers and small businesses - ERISA Fiduciary Advisor

Generally, at least one common-law employee must be a participant covered under the plan in order for that plan to be subject to Title I of ERISA, and therefore be covered by this Advisor.

The term “employee benefit plan” as defined in section 3(3) of Title I does not include a plan the only participants of which are “[a]n individual and his or her spouse . . . with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse” or “[a] partner in a partnership and his or her spouse.” A plan that covers as participants “one or more common law employees, in addition to the self-employed individuals” will be included in the definition of “employee benefit plan” under section 3(3).

Is at least one “common-law” employee a participant covered under the plan?

Yes
No