Understand the Basis for DismissalOnce you have located all relevant documents, the first practical step is to clearly understand the basis for the employee’s termination. Unlike other types of benefits described in this guide, whether an employee is terminated for-cause or not-for-cause should not have any impact on the employee’s rights to their vested 401(k) plan balance. This is usually permissible under 401(k) plan rules but may require a plan amendment or other proper authorization to do so. The key is to remember that severance payments are never eligible for 401(k) plan contributions (or related employer matching contributions), but depending on the terms of your 401(k) plan certain “post-termination payments” could be eligible. Similar to 401(k) plans, for-cause terminations generally do not affect vested benefits, but could impact certain early-retirement subsidies depending on plan design.