Webinar: On August 4, 2016, from 12:00 – 1:30, Frank Del Barto will review the current 401(k) excessive fee litigation environment, use a recent Minnesota collision repair company case as a teaching tool, and guide clients and friends of the Firm in strategies to help reduce 401(k) litigation risks via the use of plan committees, investment policy statements, and fiduciary liability insurance. This webinar is intended for executives and H.R. and benefits professionals who have 401(k) plan responsibilities or who are charged with benefit plan administration, corporate compliance and risk reduction strategies.
401(k) plans are not install and forget plans. For the last several years, Fortune 500 companies have been the target of ERISA lawsuits that allege that various plan fiduciaries (company presidents, chief financial officers, plan committees, H.R. and benefit professionals) breached their fiduciary duty owed to employee/plan participants by allowing excessive administrative and investment fees to be paid by employee/plan participants. For each "excessive fee" paid, an employee/participant has less money in his or her individual retirement account, resulting in the basis for the lawsuits.
The 401(k) litigation market may be shifting. In May, two employee/plan participants filed a class action lawsuit against a Minnesota collision repair company, its president and its chief financial officer in their capacity as plan trustees, alleging many of the same excessive fee and breach of fiduciary duty claims found in the Fortune 500 company litigation. Unlike the 401(k) plan of a Fortune 500 company, the collision company's 401(k) plan only has about 114 participants and only holds about $9.2 million in plan assets.
Small and medium size company risk reduction. Whether or not the litigation market is shifting, company presidents, chief financial officers, H.R. and benefit professionals are often considered plan fiduciaries under ERISA. As plan fiduciaries, these individuals have a fiduciary duty to defray the cost of plan administration and act in the best interest of employee/plan participants and beneficiaries. To meet this duty, plan fiduciaries must, among other things, monitor and understand all plan fees and expenses and review all aspects of plan governance and administration on a periodic basis.
A systematic review plan process and fiduciary insurance are key elements in any company's risk reduction strategy.
Registration for the webinar: To sign up, click here.