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Entries in Fiduciary Responsibility (23)

Friday
Jan042019

December 2018 Client Advisory

This Client Advisory, originally distributed in December 2018, highlights important developments in the law governing employee benefit plans and executive compensation over the past year.  It offers insight into what these developments mean for employers and plan sponsors and previews developments we expect to see in 2019. 

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Tuesday
Oct232018

Join Us for Managing 401(k) Plan Fiduciary Risk on 11/8

In today’s ever-changing and challenging 401(k) environment, plan sponsors find themselves in a new and seemingly complex environment. Regulations are becoming increasingly complicated, the number of class action lawsuits continues to rise, and employees insist on access to less expensive options with better performance, without understanding what the fees include. Retirement plan sponsors have an obligation and responsibility to reduce their fiduciary risk and improve the effectiveness of their retirement program for their participants.

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Monday
May072018

Socially Responsible Investing and the Plan Fiduciary

In the wake of mass shootings, environmental disasters, industrial accidents, drug and tobacco use pandemics, and other tragedies, retirement plan investors are paying more attention to selecting or rejecting investments based on perceived public policy benefits or detriment.  For example, investors are more focused than ever on the larger implications of a mutual fund’s holdings in arms manufacturers and diamond mine operators. Retirement plan fiduciaries increasingly find themselves in the difficult position of having to respond to these concerns when they are raised by plan participants and beneficiaries while fulfilling their fiduciary duties under ERISA. In fact, ERISA plan fiduciaries and the Department of Labor have been wrestling with the concept of socially responsible investing for many years.

The DOL’s most recent guidance on the subject was released on April 23, 2018 (Field Assistance Bulletin 2018-01). This FAB is the latest in a series of pronouncements that includes opinion letters and prohibited transaction exemptions in the 1980s, and ERISA Interpretive Bulletins in 1994, 2008 and 2015. Consistent with the purpose of a Field Assistance Bulletin, FAB 2018-01 purports to interpret rather than replace prior guidance. Nonetheless, it may have a chilling effect on plan fiduciaries who have relied on the 2015 guidance to consider one or more socially responsible investments for retirement plans.

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Tuesday
Mar202018

Fifth Circuit Vacates DOL Conflict of Interest Fiduciary Rule

The Fifth Circuit vacated the Department of Labor’s long-suffering conflict of interest rule (commonly referred to as the “fiduciary rule”), holding that the rule exceeds the scope of DOL’s regulatory authority. The decision means that the expanded definition of fiduciary, the elevated standards of conduct for certain investment advisors, and the accompanying prohibited transaction exemptions are not enforceable in the Fifth Circuit, at least for the time being.

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Thursday
Mar152018

Time is Running Out – New Disability Claims Procedures Take Effect April 2, 2018

It has been a long time coming, but the Department of Labor’s final rule regarding disability benefit claims procedures (the “Final Rule”) will finally take effect on April 2, 2018.  Employers need to determine which of their ERISA plans will be subject to the Final Rule and implement the changes necessary to comply by April 2, 2018.  Any benefit plan that is subject to ERISA and allows a claims administrator to exercise discretion in determining whether a participant is disabled (rather than relying on an independent determination from the Social Security Administration for example) must take steps to comply with the Final Rule. 

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