Introduction
Offering a retirement plan can be
both rewarding and challenging for an employer. The employees participating in
the plan, their beneficiaries, and the employer all benefit from a retirement
plan. By deciding to offer the plan, the employer also takes on certain
responsibilities and requirements in administering the plan and managing its
assets.
Fiduciaries are those individuals
and/or entities who manage an employee benefit plan and its assets. Employers
often hire outside professionals, sometimes called third-party service
providers, or use an internal administrative committee or human resources
department to manage some or all of a plan’s day-to-day operations. Employers
who have hired outside professionals or who use internal committees/resources
still have fiduciary responsibilities.
The Employee Retirement Income
Security Act (ERISA) is the federal law that sets standards of conduct for
fiduciaries. This Advisor is designed to provide an overview of the basic
fiduciary responsibilities applicable to retirement plans under the law. While
employees are welcome to review the information in this Advisor, the intended
audience is employers and third party service providers, such as accountants,
attorneys, third party administrators, and others directly involved in the
plan. Additional information for employees is listed in the
Resource section.
We recommend that you review all
sections of this Advisor in order to get a better understanding of fiduciary
responsibilities.
Disclaimer: This Advisor provides a simplified explanation of the law
and regulations regarding
the scope of ERISA’s fiduciary responsibility requirements for private-sector
retirement plans. It is not a legal interpretation of ERISA, nor is it intended
to be a substitute for the advice of a retirement plan professional.
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