Question

Under a cliff vesting schedule, an employee is considered fully vested after completing _____ years of service.

A. 10.
B. 5.
C. 15.
D. 20.
E. 30.

Answer 1

The correct answer is Option A: 10 years of service. Under a cliff vesting schedule, an employee is considered fully vested after completing 10 years of service.

Step-by-step explanation:

The correct answer is Option A: 10 years of service.

Under a cliff vesting schedule, an employee becomes fully vested after a specific period of time. In the case of cliff vesting, the vesting period is determined by the employer and is typically a few years. Once the employee completes the required years of service, they become fully vested, meaning they have complete ownership of their retirement plan or stock options.

For example, if an employee is on a cliff vesting schedule of 10 years and leaves the company before completing the 10-year mark, they will not be entitled to any benefits or ownership rights in the retirement plan or stock options.