I don't know much about 403(b) plans.

I understand the final regs don't allow employees to self certify hardships. However, my understanding has always been that if the employer certifies the hardship, they might inadvertently make the plan subject to ERISA. Am I missing something on this? How does a plan with hardships keep its non-ERISA status? Would having the vendor make the determination solve this issue? TIAA-CREF has offered to either have the employer make the determination or let the employer make the determination.

If it's a public school plan, then you do not run the risk of becoming an ERISA 403b plan, due to the governmental plan exception to ERISA.

Otherwise, too much involvement by the employer in a plan that only allows employee contributions might push the 403b plan from the non-ERISA into the ERISA arena. In light of DOL FAB 2007-02, I do not think the nonprofit employer can keep its plan from slipping into ERISA territory if the employer makes the hardship decision. Better structure the plan so TIAA-CREF deals directly and solely with the employee re hardship withdrawal, or not allow hardships, or begin complying with ERISA.