If I am 100% vested does that mean I get to keep the earnings from employer contributions?

Question

My company screwed up the 401k when they set it up, so they had different vesting schedules for different people. I was supposed to be 100% vested, but when I left the company and rolled over my 401k the rollover was $800 short due to the forfeiture of the non-vested amount. I alerted my old company and they promised to cut me a check for the rest plus 25% for taxes. Today I was told they are cutting me a check for $600 plus 25%. I was told that I was only entitled to the employer contributions, not the earnings from those contributions. I think that sounds absurd. What's the point of investing the money if I don't keep the earnings? Isn't that what 100% vesting means?

Answer 1

Yes you are entitled to all the money in your account, employer and yours Congratulations

Answer 2

That is absurd, obviously the rest of your 401K that rolled over properly had the earnings from the employer contributions... so why not the second check... unless the earnings did not vest until after your leaving date. (ie if the interest only accrued at the end of the month and you left on the 29th)

Start writing letters to them to document they are taking money from you.. unfortunately for $250 (200+25%) that's not enough to bring in lawyers.

luck

Answer 3

The company knows that it Will cost you more in legal fees to fight for $25 +- dollars than it's worth. Of course, I am giving my opinion on less than full disclosure. Vesting schedule, contract, employer % contributions,all sway end conclusion.

Answer 4

put your energy into getting a new job and dont sweat the minor cash...they really are doing you a favor buy just cutting you a check...otherwise you would have to pay a penalty to get the money from the investment company....its usually 40%