Question: We have several new employees who will be involved with our 401(k) plan. How can we help them stay on the right side of their duties as fiduciaries?
Answer: You’re wise to ask. Fiduciary training can help protect individual fiduciaries, the plan as a whole — and, of course, the participants. You may already know that the penalties for fiduciary breaches can be both criminal and civil, a fact that emphasizes the importance of knowing how to carry out these duties. While seeking out targeted fiduciary training from your plan’s advisor, consultant or legal counsel is a good course of action; there are a few things important to understand right away. First is that a fiduciary may or may not be named in the plan document. It’s the actions that determine fiduciary status, not just the title. Everyone who works on the plan in any capacity should know whether or not they are a fiduciary. They must be careful to always act in accordance with ERISA’s “sole interest” rule. It requires plan fiduciaries to act in the sole interests (a higher standard than “best interests”) of the plan’s participants and beneficiaries.
Benefits of Hiring TRA as a Delegated 3(16) Plan Administrator
You may choose our organization to serve as a delegated 3(16) plan administrator providing 3(16) fiduciary services — also known as Plan Administration Relief Services (PARS). We relieve the business owner or sponsor of many of the day-to-day administrative burdens associated with sponsoring a plan.
- Time savings
- Reduced liability
- Increased human resources capacity
- Reduced audit risk
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