Thank you for your help Marsha this clears things up, I just want to further clarify.
So while there can't be a "fee" charged to the employee, an adjustment in wage may possibly be allowed? This adjustment of course would occur before any final agreement between the employer and employee as to what the wage rate will be.
So it can't be stated to employee:
You are earning $100,000 but with a fee for 401K participation you will earn $95,000
but possibly may be able to say you will be earning $95,000
Further, The employer in this case is in fact a consulting firm that pays employees working for clients with funds from the client when approved.
So if the Client is offering to pay for the employee $100,000 can the employer/firm tell the employee they are being offered $95,000 if they take the 401K option with employer matching, or $100,000 if they dont take the 401K
Thank you again for your help.