Category Archives: Fiduciary Matters

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Who owns a 401(k) participant’s personal information?

Service providers for 401(k) and other retirement plans require access to personal data on participants including name, age, address, date of hire, compensation and possibly social security number to provide recordkeeping services. Are these plan service providers simply taking advantage of a business opportunity or are they improperly exploiting information that is a  plan asset … Continue Reading

How not to hire an ERISA auditor

Selecting an auditor for an ERISA plan is one of those fiduciary responsibilities which has been a continuing concern of the Department of Labor (“DOL”). At a June 25, 2019 meeting of the DOL’s ERISA Advisory Council, James Haubrock of the American Institute of CPAs responded to the Council’s request for recommendations on how the … Continue Reading

Take Advantage of ERISA Safe Harbors: They can help penetrate the ERISA fog.

Attorneys would define a Safe Harbor as a provision of a statute or a regulation that specifies that certain conduct will be deemed not to violate a given rule. In our ERISA world, a Safe Harbor is a provision of the retirement plan law  that can  cut through the sometimes fog of ERISA and provide … Continue Reading

Seven ways a fiduciary can follow “Procedural Prudence”

“Procedural Prudence” is not a new concept. It underlies one of ERISA’s bedrock requirements. A fiduciary must discharge its duties prudently with care, skill, and diligence. It’s the process by which a fiduciary can accomplish this. In other words, it’s the “how” a decision gets made which is what the courts have focused on in … Continue Reading

Timely reminder why an ERISA fidelity bond is necessary

July 31st, is of course, the due date (unless extended) for calendar year ERISA plans required to file Form 5500 for the 2016 plan year. And, as in the past, there will be many plan sponsors who must indicate on the 5500 they have outdated fidelity bonds or none. Here’s a timely reminder why they … Continue Reading

Non-ERISA 403(b) plans must walk a fine line to avoid losing the ERISA exemption

Last month’s Supreme Court decision, Advocate Health Care Network v. Stapleton, upholding ERISA exemption for church-affiliated pension plans was a reminder that not all benefit plans are subject to ERISA. Indeed, non-profit employers who sponsor 403(b) plans can choose to be exempt from ERISA. But they have to tread carefully.… Continue Reading

Boomerang Employees and 401(k) Considerations

We used to call them “rehires” back in the day: those employees who quit and were hired back. And it didn’t happen all that often. Many companies had policies not to. They’re now called “boomerang employees, and now it’s different. Different times, different economy. Employees who left the nest decide they want to come back, … Continue Reading

Stolen Laptop Triggers $1.55 Million Fine for HIPAA Violation

Actually, it was “only” a potential violation of privacy and data security rules imposed by the Health Insurance Portability and Accountability Act of 1996 (HIPAA) for which North Memorial Health Care of Minnesota (“NMHC”) agreed to pay $1.55 million. The violation alleged by the Department of Health and Human Services Office for Civil Rights (“OCR”) … Continue Reading

It’s a 401(k) fee state of mind for plan fiduciaries

Class action law suits and Department of Labor enforcement initiatives have created a 401(k) fee state of mind for fiduciaries. How much, who pays for them, and how they are paid are issues about which service providers offer guidance. @GregIacurci in his article, How Should Retirement Plans Pay Their 401(k) Fees? in Investment News (registration … Continue Reading

Enhanced health benefits for executives? That’s another Affordable Care Act issue to consider

A prohibition on discrimination has applied to self-insured plans for years under  Section 105(h) of the Internal Revenue Code. The Affordable Care Act (“ACA”) now extends that ban on discrimination in insured group health plans. What does this mean? Insured health plans  can no longer favor highly compensated employees in terms of eligibility for benefits … Continue Reading

Welfare Benefit Plans: More than just the Affordable Care Act

Many employers sponsoring welfare benefit plans are understandably now totally focused on what they can see in front of them. Namely, the Affordable Care Act. But lurking just below the surface is ERISA and a host of other laws through which employers have to navigate. Let’s start with ERISA. Most welfare benefit plans are subject … Continue Reading

ERISA Employee Benefit Claims: Legislative Goals vs. Litigation Reality

Every Summary Plan Description has to include one, a claims procedure that set forth the requirements for processing benefit claims and appeals. The underlying ERISA statute was written in a paternalistic manner with explicit provisions intended to offer protection to “the interests of participants in employee benefit plans and their beneficiaries…by providing for appropriate remedies, … Continue Reading

Sorry, MacGyverisms can’t solve 403(b) problems, but there are ways to fix them

Back in the 1980s, I thought MacGyver could fix anything. Using everyday items, he invented ways to fix critical problems. These inventions became synonymous with the character and became known as “MacGyverisms”. Just a little more than halfway through Season 1, for example, he had Disarmed a missile with a paper clip Raised a fallen … Continue Reading

Who pays 401(k) fees? Us or them?

        That’s the question employers ask regarding who pays 401(k) fees. The “us” being, of course, the employer, and the “them” being the plan participants. The number of “thems” has been increasing. According to Deloitte’s 2015 Annual Defined Contribution Benchmarking Survey, the number of employers completely covering the cost of fees declined … Continue Reading

ERISA Plans Do Have Their Limitations

That’s limitations as in “limitation periods”. A recent court case reminds ERISA plans to have such limitation periods and to communicate it to someone claiming a plan benefit. Let’s start with the basics. What’s a “limitation period”? In layman’s terms, it’s a law set forth in a State statute of limitations that sets time limits … Continue Reading