This might seem like a set if silly questions – for some reason I am doubting myself

Business owner establishes a business in 2014
entity type – S-Corp
In 2014 – the owner had no income (either K-1 or W-2)
SEP eligibility was most rigid allowed by law (age, 21, 3 of 5 years, and $600)
Business owner would like to make a contribution for 2016 tax year on behalf of him and eligible employees.

Questions
Is the owner eligible to receive a 2016 contribution? Although he performed “services” (for himself) in he did not have any income in 2014. I would think “no” as he did not satisfy the minimum earnings amount for 2014 (I think at the time was $500) – Assuming I am correct my guess it’s too late to change the eligibility requirements thus allowing him to receive a 2016 contribution? Confirmation needed.

Separate question in regards to the 3 out 5 year rule. Is it 3 out the previous 5 years? in other words do you include the current year or not? For example, if an employee was hired in 2015 – would they be eligible to receive a 2017 SEP contribution? Or would they first be eligible in 2018?

Thank you