An executive deferred compensation plan allows employers to put off money for retirement. Here's how it works.If you are currently enrolled in a 457 plan, you will begin to enjoy lower administrative fees. Before you complete this form, please read the accompanying literature in the 457. State employee: • This form is used for stopping deferrals, changing product investment or beneficiary. A top hat plan is a type of employer-sponsored plan that is unfunded. The design of the plan is to provide deferred compensation to the eligible employee group. Employees agree with their employer to defer a portion of their salary or bonuses.