What are the age and service requirements for an employee to participate in the Belocal 401(k) plan for elective deferral contributions?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
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4. 401(k) Savings Plan
The Company sponsors a defined contribution 401(k) plan covering all eligible employees. To participate in the plan for the purposes of 401(k) elective deferral contributions, an employee must be 18 years of age or older and must have completed 90 days of service. Participants can elect to contribute through salary deductions a maximum of $23,500, $23,000, and $22,500 for the calendar years ending December 31, 2025, 2024, and 2023, respectively. The Company will contribute a matching contribution equal to 100% of the employee 401(k) elective deferral contributions which are not over 3% of the employee's pay, plus 50% of the employee 401(k) elective deferral contributions which are over 3% of the employee's pay, but are not over 5% of the employee's pay. Vesting of matching contributions occurs over the period of 6 years. Employer contributions to the plan during the years ended June 30, 2025, 2024 and 2023, were
Source: Item 23 — RECEIPTS (FDD pages 71–242)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, to participate in the company's 401(k) plan for elective deferral contributions, an employee must be at least 18 years old and have completed 90 days of service. This means that a new employee cannot immediately begin contributing to the 401(k) plan but must wait until fulfilling these requirements.
For a prospective Belocal franchisee, this information is relevant when considering employee benefits and compensation packages. Understanding the eligibility requirements for the 401(k) plan helps in managing employee expectations and planning for workforce retention. Franchisees should communicate these requirements clearly to potential and current employees.
The plan allows participants to contribute through salary deductions, with maximum contributions of $23,500 for the calendar year ending December 31, 2025. Belocal also provides a matching contribution, which is 100% of the employee's elective deferral contributions up to 3% of their pay, and 50% of contributions exceeding 3% but not over 5% of their pay. This matching contribution vests over a 6-year period, meaning employees gradually gain full ownership of the employer's contributions over that time. Employer contributions to the plan were $154,390 for the year ending June 30, 2025.
Knowing these details about the 401(k) plan can be a selling point for attracting and retaining employees, as it provides a clear picture of the retirement benefits offered by Belocal. Franchisees should stay updated on any changes to these contribution limits and matching policies to ensure compliance and maintain a competitive benefits package.