and SkyWest Charter captains are eligible for non-elective profit sharing contributions ranging from 0% to 20%, based on position and years of service.
Each year the Company may make an additional discretionary matching contribution. Discretionary matching contributions are recorded when authorized by the Company’s Board of Directors. An employee is eligible to receive a discretionary matching contribution if he or she is an eligible employee, has completed one year of service and is employed on the last day of the allocation period. The Company made a $0.5 million discretionary match in 2023 based on the Company’s results for the 2022 year, which was included in contributions receivable at December 31, 2022. The Company made a discretionary matching contribution in 2022 of $1.6 million based on the Company’s results for the 2021 year, which was included in contributions receivable at December 31, 2021.
Additionally, each year the Company may make a discretionary profit sharing contribution to Plan participants who are not SAPA pilots or SkyWest Charter captains. An employee is eligible to receive a discretionary profit sharing contribution if he or she is an eligible employee, has completed two years of service and is employed on the last day of the allocation period. The Company did not make a discretionary profit sharing contribution in 2022 or 2021.
(e) Participant-Directed Options for Investments
Participants direct the investment of their contributions and the Company matching and discretionary contributions into various investments offered by the Plan. Investment options include mutual funds, common/collective trusts and pooled separate accounts, a stable value fund, a self-directed brokerage account, and SkyWest, Inc. common stock. Participants may change their elections or transfer investments between funds at any time.
Participants with SkyWest, Inc. common stock in their accounts may direct the sale of the stock and the investment of the resulting proceeds into other investments offered by the Plan.
(f) Vesting and Payment of Benefits
Participants are immediately vested 100% in their account balances, with the exception of SAPA pilots hired after October 1, 2022, who have a three-year service requirement before they are vested in the Company matching contribution. Benefits are normally paid at retirement, disability, death, or other termination of employment. Benefits distributions may be made in a single lump sum payment or in equal installments over a specified period of time. Participants may withdraw funds from the Plan while actively employed subject to specific restrictions set forth in the Plan document.
(g) Notes Receivable from Participants
The Plan document provides for loans to be made to participants and beneficiaries. The loans must bear a reasonable rate of interest, have specific repayment terms and be adequately secured. The Plan permits participants to take loans up to the lesser of $50,000 or 50% of the participant’s vested account balance.
(h) Custodian and Recordkeeper
As of December 31, 2022, and for the year then ended, Charles Schwab Trust Bank and Schwab Retirement Plan Services, Inc. (collectively “Schwab”) provided the recordkeeping and custodial services for the Plan. Schwab is also the directed trustee of the Plan.