nonhighly compensated work force
(5) Safe harbor (A) In general In the case of requirements described in subparagraphs (A) and (B) of paragraph (3), this subsection shall not apply to any leased employee with respect to services performed for a recipient if— (i) such employee is covered by a plan which is maintained by the leasing organization and meets the requirements of subparagraph (B), and (ii) leased employees (determined without regard to this paragraph) do not constitute more than 20 percent of the recipient’s nonhighly compensated work force. (B) Plan requirements A plan meets the requirements of this subparagraph if— (i) such plan is a money purchase pension plan with a nonintegrated employer contribution rate for each participant of at least 10 percent of compensation, (ii) such plan provides for full and immediate vesting, and (iii) each employee of the leasing organization (other than employees who perform substantially all of their services for the leasing organization) immediately participates in such plan. Clause (iii) shall not apply to any individual whose compensation from the leasing organization in each plan year during the 4-year period ending with the plan year is less than $1,000. (C) Definitions For purposes of this paragraph— (i) Highly compensated employee The term “highly compensated employee” has the meaning given such term by section 414(q). (ii) Nonhighly compensated work force The term “nonhighly compensated work force” means the aggregate number of individuals (other than highly compensated employees)— (I) who are employees of the recipient (without regard to this subsection) and have performed services for the recipient (or for the recipient and related persons) on a substantially full-time basis for a period of at least 1 year, or (II) who are leased employees with respect to the recipient (determined without regard to this paragraph). (iii) Compensation The term “compensation” has the same meaning as when used in section 415; except that such term shall include— (I) any employer contribution under a qualified cash or deferred arrangement to the extent not included in gross income under section 402(e)(3) or 402(h)(1)(B), (II) any amount which the employee would have received in cash but for an election under a cafeteria plan (within the meaning of section 125 ), and (III) any amount contributed to an annuity contract described in section 403(b) pursuant to a salary reduction agreement (within the meaning of section 3121(a)(5)(D)).