Break-in-Service Definitions are rules that determine a date before which any service earned (through the performance of duties, etc.) is excluded from final service amounts. Specifically, for non-vested members who quit work (or begin working less than a certain number of hours in a year) and are later re-employed, break-in-service rules are used to exclude service that is deemed lost because too much time has passed since their last employment. Examples of breaks-in-service: using hours - 500 hours or less worked in a year constitutes a break; using elapsed time - service of three months or less constitutes a break. Services that often require break-in-service rules include vesting, eligibility and credited or benefit services. In ProAdmin Break-in-Service Definitions are applied (or not) to Service Definition Sets by indicating which break-in-service rule should be used in the Service Definition Set dialog box.

There are three main components to determining whether breaks-in-service rules have an effect on service and ultimately benefit amounts. They are:

1. definition of a break-in-service.

2. number of consecutive breaks needed to exclude service.

3. vesting eligibility.

If and when prior service is to be excluded is determined procedurally. Beginning with the member’s year of hire and continuing through every subsequent year (calendar or plan), an evaluation is made of whether a break has occurred or not. Consecutive one year breaks are added as they occur. If at any time, before the member is vested, the number of consecutive breaks equals or exceeds the number needed to exclude prior service, a date is established. This date (or disregard date) is the end date to the period of excludable service. All service on and before this date is disregarded. If there is an interruption of consecutive breaks (i.e., if the member works enough during a year to not incur a break) the summing of consecutive breaks begins at zero. The procedure continues throughout the member’s career and stops at the earlier of vesting (including partial vesting) and decrement. The vesting service used in the vesting eligibility must be a Service Definition Set which uses the Break-in-Service rules being setup. If a disregard date is established, any Service Definition Set using Break-in-Service rules will exclude or disregard service on and prior to the disregard date. If no disregard date is established, no service will be excluded in the service calculation.

Name may be any descriptive phrase, including spaces, under which to save this Beak-in-Service Definition.

The Definition of a break frame includes the parameters that define what constitute a break:

Choose A one-year break-in-service occurs when you earn Zero service radio button when any service during the year causes a break not to be incurred. Often service for break-in-service purposes is transformed into a zero (0) or a one (1). 0 means a break and 1 means no break. Choose the Less than xx years of service radio button if a non- zero amount of service can still constitute a break. Fill in the blank with the maximum that, if earned, would still be considered a break in service. Example: Less than 0.33 years of service could be used if service is measured in whole months and less than 4 months of service constitutes a break.

Choose the During a Plan Year radio button if the measurement period for breaks in service is a plan year. Choose the Calendar Year radio button if the measurement period for breaks in service is a calendar year.

The Using Service Definition Set multi-choice field selects a Service Definition Set that is used to determine whether a break-in-service has occurred. As such, the Service Definition Set selected must have the “Do not apply” radio button selected under the ”Break-in-service rule:” section. An example of an hours-based Service Definition that might be used is one where service is zero if hours are 500 or less and service is one if there are more than 500 hours. The button allows you to go directly into the Service Definition Set library and set up a new entry or change an existing one.

The Disregard Service frame indicates when enough breaks have occurred that the prior service is not longer relevant. Indicate in the blank of Disregard pre-break service when the break is xx or more consecutive years parameter how many consecutive break-in-service years are required so service earned before the commencement of the breaks can be excluded or disregarded from the computation of service in the Service Definition Sets that use this Break-in-Service Definition.

The Stop determining breaks at vesting frame indicates when the break-in-service calculations can cease because the member has met the vesting requirements of the plan. The Determine if vested using this Eligibility Definition: multi-choice field selects the Eligibility Definition from the library with the requirements for the member to become vested or partially vested. After the member is at least partially vested the break-in-service rules are no longer applied. The and this Service Definition Set: multi-choice field selects the Service Definition Set that defines vesting service for evaluating the Eligibility Definition selected above. The Service Definition Set selected here must use this Break-in-Service Definition in its computations. The button allows you to go directly into the Service Definition Set library and set up a new entry or change an existing one. The button accesses the library to create or modify Eligibility Definition Set and Service Definition Sets respectively.