Category: Fiduciary Duties
PODCAST: 403(b) Plan Fee Litigation Update
Verrill Dana Employee Benefits attorneys Eric Altholz and Chris Lockman provide a brief update on class action lawsuits alleging various breaches of fiduciary duties under ERISA pending against a dozen major universities. All of these lawsuits are related to the administration of the 403(b) plans maintained by the universities...
Client Advisory - Winter 2016
This Client Advisory highlights certain developments regarding the Affordable Care Act (most significantly, the delay of the ACA reporting requirements and the "Cadillac" tax), discusses the EEOC's proposed rules for wellness programs and the outcome of recent EEOC wellness program litigation, reviews important cases recently decided by and pending...
Fiduciary Committee Best Practices – Part 2: Preparing Meeting Minutes
In Part 1 of this two-part series we suggested that the key to compliance with the fiduciary requirements of ERISA can be boiled down to a simple proposition: follow a prudent process and document it. We used that proposition as a basis for offering five foundational steps that a...
Fiduciary Committee Best Practices – Part I: The Basics
Even in areas of law where the landscape of rules, regulations, and risks seems constantly to be changing, certain core concepts and basic principles hold fast. In the case of fiduciary responsibility under ERISA, the core concepts and basic principles can be boiled down to three key elements: (1...
Fort Halifax Redux: Identifying an ERISA Plan Made Simple Again
We are frequently asked by clients whether a severance policy or program is an "ERISA plan" and, thus, subject to ERISA's documentary, administrative, reporting, and disclosure requirements. A recent decision from the United States District Court for the District of Puerto Rico provides a helpful analysis of this re-occurring...
Selecting Investment Consultants for Pension Plans With Imperfect Information
An article in the business section of the New York Times last week reported some surprising conclusions reached by a recent study of the performance of pension plan investments. ("Doubts Raised on Value of Investment Consultants to Pensions," September 30, 2013.) The study, performed by two Oxford professors, revealed...
July 1 Deadline Approaching for Service Provider Disclosures
As all sponsors and fiduciaries of tax-qualified retirement plans should know by now, written fee and expense disclosures are due to be provided to plan fiduciaries by "covered service providers" by July 1. As we explained in a prior post , this important disclosure is mandated by final regulations...
Participant-Level Fee Disclosure for ERISA and Non-ERISA Plans
After our recent post on the fiduciary-level fee disclosure rules under ERISA Section 408(b)(2), we wanted to complete the picture for plan fiduciaries by revisiting the participant-level fee disclosure rules under ERISA Section 404(a). These rules require fiduciaries of participant-directed individual account plans (such as 401(k) and 403(b) plans...
Plan Fiduciaries Should “Welcome” Final Regulations Regarding Service Provider Disclosures
Last week the U.S. Department of Labor published Final Regulations dealing with service provider disclosures under Section 408(b)(2) of ERISA. This is the latest in a series of regulatory initiatives undertaken by the DOL to ensure that plan fiduciaries, as well as plan participants and beneficiaries, obtain meaningful information...
DOL Finalizes (and Adjusts) Delay in Fee Disclosure Rules, Clarifies Quarterly Notice Requirement
Yesterday the DOL's Employee Benefits Security Administration (EBSA) issued a final rule delaying the applicability dates of the new fiduciary and participant fee disclosure rules. This final rule extends the effective date of the new fiduciary-level fee disclosure rules under ERISA Section 408(b)(2) from July 16, 2011 to April...
DOL Officially Proposes Delay in Application of Fiduciary Fee Disclosure Rules
The DOL's Employee Benefits Security Administration (EBSA) has finally provided official notice of its proposal to delay the applicability date of the new fiduciary fee disclosure rules under ERISA Section 408(b)(2), from July 16, 2011 to January 1, 2012. Although EBSA announced its intention to propose this delay back...
The Presumption of Prudence Persists: In re UBS ERISA Litigation
In 1995 the Third Circuit Court of Appeals broke new ground in the area of fiduciary liability under ERISA when it found that an action of a fiduciary "should be presumed to be reasonable" if the terms of a retirement plan "require or strongly encourage" the fiduciary to take...
A Prudent Process Protects Fiduciaries
Section 404(a)(1)(B) of ERISA requires a fiduciary to discharge its duties with respect to an ERISA plan "with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of...
DOL Announces Delay in Application of Fiduciary Fee Disclosure Rules
Today EBSA (part of the DOL) announced its intention to delay the applicability date of the new feedisclosure rules under Section 408(b)(2) of ERISA, from July 16, 2011 to January 1, 2012. These interim final rules , published on July 16, 2010, require certain pension plan service providers to...
Update Regarding Expanded Definition of "Fiduciary"
The Employee Benefits Security Administration (EBSA) will hold a hearing to consider issues regarding the adoption of a new regulation defining when a person is considered a "fiduciary" by reason of giving investment advice to a benefit plan or to a plan's participants. The hearing will be held on...
Proposed DOL Regulations Expand Meaning of "Fiduciary"
Proposed regulations published last week by the Employee Benefits Security Administration (EBSA), part of the DOL, would modify the definition of "fiduciary" under ERISA by expanding the meaning of the term "investment advice." The DOL explained that the definition of "investment advice" – which has remained unchanged since it...
Using Retirement Plan Assets to Pay Plan Administrative Expenses
We are sometimes asked: when is it okay to use retirement plan assets to pay for plan administrative expenses? The question often comes up in the context of a restatement of the plan document, the preparation of a new SPD or some other project where the costs may be...
Some Basic Advice to Plan Investment Fiduciaries
Capital markets worldwide have recovered from their 2009 lows, but remain in a protracted period of extreme volatility and we continue to experience wide swings in market sentiment that seem to defy explanation. Though market fluctuations affect all retirement plans with assets to invest, the unstable investment environment is...
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