Aiding Plan Sponsors with Fiduciary Responsibilities
When maintaining and operating employee benefit plans, plan sponsors have specific rules to follow and responsibilities to uphold. These responsibilities and tasks open plan sponsors up to certain personal liabilities should an error or a misstep in plan management or operation occur. You can take steps to monitor and mitigate risk by first understanding your fiduciary role and responsibilities.
When you team up with Kiesewetter Law Firm, PLLC, our experienced attorney will take the time to help you understand your fiduciary responsibilities associated with your company’s employee benefit plans. We’ll also work with you to take proactive measures to reduce and mitigate liability.
What Is Your Role As a Plan Sponsor?
Many companies establish and operate employee benefit plans without a clear-cut understanding of their fiduciary responsibilities. Individuals tasked with managing and administering employee benefits plans are held to the highest standard of conduct regarding plan compliance. If you engage in fiduciary tasks related to your plan, you must understand your fiduciary responsibilities as well as the potential liability involved. If any breaches of fiduciary duties occur, the company and individuals responsible for overseeing the benefits plans can be held liable. This is true even if the breach of duty wasn’t intentional.
What Are the Responsibilities of a Fiduciary?
Four primary areas of fiduciary duty exist: duty of loyalty, duty to act prudently, duty to diversify investments, and duty to follow the plan documents. When it comes to benefits plans, your role is to act in the best interest of the plan participants and beneficiaries. As a fiduciary, your responsibilities include:
- To act solely in the interest of plan participants and their beneficiaries
- To act with the exclusive purpose to provide plan benefits or defraying reasonable expenses of the plan administrator
- To act with the diligence, skill and the prudence of an individual familiar with the benefits plan and all corresponding matters
- To comply with and follow all plan documents
- To diversify plan investments
- To avoid any conflicts of interests
Managing Liability Through Creative, Tactical Measures
When it comes to benefits plans, you must act solely in the best interest of the plan participants and beneficiaries. As a fiduciary, your responsibilities include:
- Follow the plan terms when operating the plan
- Monitoring your plan and your third-party advisors on an on-going basis
- Documenting all plan processes and decisions
- Correcting plan errors as soon as discovered
Get Guidance so Your Plans Remain Compliant
We want to help ensure that your benefit plans remain in compliance while confirming that your fiduciary duties are being properly fulfilled. Contact us today by calling 615-455-8106 or completing our online form to schedule an appointment. Located in Nashville, we assist businesses throughout the country. Let’s partner today.