Which of the following approaches can be used when converting from a DB plan to a Hybrid plan?

Allowing all employees to choose between the old and new plans is a beneficial approach when transitioning from a defined benefit (DB) plan to a hybrid plan, because it offers employees flexibility and a sense of control over their retirement options. This choice enables employees to evaluate the benefits and features of both plans, considering their individual financial situations, retirement timelines, and personal preferences.

This approach can also help mitigate potential dissatisfaction or confusion among employees, as they are not forced into an unfamiliar plan without their input or consent. By granting them the ability to choose, employers demonstrate consideration for the diverse needs of their workforce, which can enhance overall employee morale and trust in the organization during the transitional phase.

In contrast, mandatory transitions and the immediate elimination of old plan benefits could lead to employee unrest, as employees may feel their options have been unfairly restricted. Moreover, only accepting contributions from new employees would limit the flexibility necessary for current members to retain benefits under the old DB plan, potentially disadvantaging those who have invested in it over time. Therefore, allowing employees to choose fosters a more inclusive and supportive transition process.