In today’s organizations, many employees are asked to take on multiple roles and responsibilities. This is especially true when considering the management of a corporate retirement plan. To better understand what role each person plays in the management of a 401(k) (or any other corporate retirement plan), we have to understand what roles there are to play.
Protecting the Employer – Part 2
Part 1 of this series looked at the trust law roots of the Employee Retirement Income Security Act of 1974 (“ERISA”), focusing on determining who is considered the “settlor” of a retirement plan. Once the individual or group of individuals acting as the settlor of a plan have been identified, it is important to understand what their role is, and equally important what their role is not.Continue reading
Protecting The Employer – Part 1
In 1974, in an effort to reform an increasingly unreliable pension system, Congress enacted the Employee Retirement Income Security Act of 1974 (“ERISA”). The goal of ERISA was to protect employees in an era of underfunded defined benefit plans. Over the years the retirement plan industry has evolved a great deal. Defined benefit plans have gone by the wayside, and defined contribution plans are now often an employee’s biggest asset. The underlying framework of ERISA, however, and the often overlooked settlor/fiduciary distinction, is as important today as it was in 1974.Continue reading