6.5. ERMUSR 01-15-2008 - Laserfiche WebLink

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ARTICLE V. ELECTION OF AVAILABLE BENEFITS 5.1 Initial Elections. An Election must be made during the initial Election Period. An affirmative Election to participate is required. If the Election Period ends and an Eligible Employee has not returned an Election form to the Plan Administrator, the Eligible Employee will be deemed to have elected not to participate in Optional Benefits. To the extent there is an Employer Contribution, the Eligible Employee will forfeit the entire Employer Contribution. 5.2 Subsequent Elections. During the Election Period prior to each subsequent Plan Year, each Participant shall be given the opportunity to change his or her Election. Such changes include the following: (a) an Eligible Employee who is not participating may elect to begin participating by electing Optional Benefits during the Election Period; (b) a Participant may terminate participation in the Plan; or (c) a Participant may elect different Optional Benefits or different levels of Optional Benefits. An affirmative election is required. If the Election Period ends and an Eligible Employee has not returned an Election form to the Plan Administrator, the Eligible Employee will be deemed to have elected not to participate in Optional Benefits. 5.3 Elections Irrevocable. Once an Election becomes effective, such Election shall be irrevocable for the Plan Year or the remainder of the Plan Year except under the following circumstances: (a) Change in Status. A Participant may change or terminate his or her actual or deemed Election under the Plan upon the occurrence of a Change in Status, but only if such change or termination is made on account of and corresponds with a Change in Status that affects coverage eligibility of a Participant, a Participant's Spouse, or a Participant's Dependent (referred to as the general consistency requirement). The Plan Administrator (in its sole discretion) shall determine, based on prevailing IRS guidance, whether a requested change is on account of and corresponds with a Change in Status. Assuming that the general consistency requirement is satisfied, a requested change must also satisfy the following specific consistency requirements in order for a Participant to be able to alter his or her Election based on that change. (1) Loss of Dependent Eligibility. For a Change in Status involving a Participant's divorce, annulment or legal separation from a Spouse, the death of a Spouse or a Dependent, or a Dependent ceasing to satisfy the eligibility requirements for coverage, a Participant may only elect to cancel accident or health insurance, or insurance type, coverage for the Spouse involved in the divorce, annulment, or legal separation, the deceased Spouse or Dependent, or the Dependent that ceased to satisfy the eligibility requirements. Canceling coverage for any other individual under these circumstances would fail to correspond with that Change in Status. Notwithstanding the foregoing, if the Participant, the Participant's Spouse (but not ex-Spouse) or the Participant's Dependent becomes eligible for COBRA (or similar health plan continuation coverage under state law) under the Employer's Plan, the Participant may increase the Election for that Optional Benefit to pay for such coverage provided the Participant is still eligible under the Plan and still receiving Compensation. (2) Gain of Coverage Eligibility Under Another Employer's Plan. For a Change in Status in which a Participant, a Participant's Spouse, or a Participant's Dependent gains eligibility for coverage under another employer's cafeteria plan 02007 Hitesman & Associates, P.A. 9 Elk River Municipal Utilities 122707 Flexible Benefits Plan