For New York residents who are taking part in the Employment Retirement Income Security Act of 1974 (ERISA), it is not only important to understand the basics of the pension plan, but there are other aspects that must be accounted for to make certain that the plan is protected. It is vital to understand the fiduciary responsibilities of ERISA.
Under ERISA, the assets in the plan belonging to the participant will be protected by making sure that the individuals or entities with authority or discretionary control over the management or the assets, anyone who has authority of administration of the plan, or anyone who is giving investment advice and is compensated for it adheres to fiduciary responsibilities. This can include a trustee of the plan, an administrator of the plan, and those who are on the plan's investment committee.
The main idea is that the plan is run to adhere to the best interests of those taking part in it. Fiduciaries are expected to act reasonably and have sufficient diversity in the plan to minimize the chance that there will be large losses. There will be plan documents that must be followed. There cannot be any conflicts of interest such as transactions that will benefit anyone other than the members. If a fiduciary does not adhere to these requirements, they might be liable to restore losses that were incurred or profits that were made by improperly using plan assets. Fiduciaries can be removed from their position if they behave inappropriately.
People who are taking part in ERISA might not have in-depth information about the details of the program, but for a labor union, the retirement program is one of the most important things for its members. There are ingrained protections in place to prevent fiduciaries from impropriety, but that does not mean that there will not be illegal behaviors attempted or done and this can have a negative effect on those who are part of the plan. Having legal assistance from an attorney who is well-versed in labor law regarding ERISA is essential.
Source: dol.gov, "ERISA Fiduciary Responsibilities," accessed on Dec. 4, 2017