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It is important to point out here that there are four Highly Compensated Employees, which includes both law partners and their wives. Their wives would be considered Highly Compensated Employees through family attribution rules as discussed earlier in this course. And, while there are three Non-Highly Compensated Employees, only two of these employees (the administrative assistant and paralegal) are eligible to participate in the retirement plan. The part-time employee is not eligible to participate.

Bear in mind that the part-time employee is not excluded because she is classified as part-time. She is ineligible because she has not met the plan's hours of service requirement. The plan is being set up with a service requirement of at least 1000 hours of service to be eligible for the plan. Note on the census that the part-time employee has only worked 500 hours, so she has not worked enough hours to meet the plan's service requirement, which means that she is not currently eligible to participate in the plan.

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