Company Retirement Plans: Delegation
Delegation & Fiduciary Responsibility
Business owners and retirement plan sponsors are challenged with managing an increasingly complicated fiduciary burden, and the burden of proof falls on you to demonstrate you have jumped through all the required fiduciary hoops. ERISA (Employee Retirement Income Security Act of 1974) requires that you act as a prudent expert. This means you are to act in the best interests of the plan, participants, and beneficiaries. This makes it critical to understand and manage your fiduciary risk or delegate it wherever possible.
Administering a workplace retirement plan requires the concerted effort of many players with different responsibilities. By far the greatest obligation falls on the employer as the sponsor of the plan. Many employers are unaware of their responsibilities as fiduciaries, particularly when it comes to selecting and overseeing the plan’s service providers.