ERISA & Employee Benefits

Advisors: Time to Finish What was Started….ERISA and Fiduciary Process Have Evolved…Have You?

Over 46 years ago, the Employee Retirement Income Security Act (“ERISA”) was passed overwhelmingly in the House of Representatives by a 376-4 vote.  Congress passed ERISA to empower American workers toward retirement security.  Fast forward, on May 23, 2019, the House of Representatives overwhelmingly passed the Setting Every Community Up for Retirement Enhancement Act (“SECURE Act”) by a vote of ...

Supreme Court's Actual Knowledge Decision Underscores Importance of Plan Administrator Best Practices

The Supreme Court settled the debate over what constitutes "actual knowledge" in the context of an ERISA fiduciary breach claim in a unanimous and simple decision that applied dictionary definitions of the term "actual" to find that the fiduciary breach knowledge requirement means that "the plaintiff must in fact have become aware of that information." The Intel Investment Policy Committee v. ...

Eighth Circuit Delivers Guidance on Whether Rate Setting Amounts to Fiduciary Conduct

Courts have long struggled to set the boundaries at which point ERISA plan service providers exert sufficient control and discretion over plan assets to make them fiduciaries under ERISA 3(21). The significance of being an ERISA fiduciary is self-evident in the litigation context: if an entity is not an ERISA fiduciary, then it cannot be liable for a breach of ERISA's fiduciary duties and ...

Congress Considers Multiemployer Pension Reforms While Benefit Suspensions Loom

The U.S. Treasury Department has received an application by the American Federation of Musicians and Employers' Pension Fund (the "Plan") to suspend benefits under the Multiemployer Pension Reform Act of 2014. Multiemployer pension plans cover union-represented workers and are run by a board of trustees, half appointed by the union and half appointed by employers. Most provide a traditional ...

SECURE Act Finally to Become Law

Congress is subject to one of the same vices as many Americans, namely, putting off important activities until the last moment. Earlier this year, the House of Representatives by a 417-3 vote, approved the Setting Every Community Up for Retirement Enhancement (SECURE) Act (or “Act”), but it never advanced in the Senate, in part because of reservations as to how it would be paid for. However, this ...

ERISA Case in the District Court for the Southern District of New York Highlights Plan Sponsor QDRO Responsibilities

A sometimes forgotten issue in a divorce, separation, or other domestic relations proceeding is the division of retirement plan benefits between former partners and/or husband and wife. While the general rule is that ERISA and the Internal Revenue Code do not permit a participant to assign or alienate the participant's interest in a retirement plan to another person, a developed exception to the ...

Private Equity Fund Gains Important Victory

In Sun Capital Partners III v. New England Teamsters and Trucking Industry Pension Fund, the Court of Appeals for the First Circuit ruled on November 22 in favor of private equity funds, thus settling a long-running dispute as to whether two Sun Capital Funds could be held liable for the withdrawal of a portfolio company from the New England Teamsters Multiemployer Pension Plan.  

Two Opinions Demonstrate Importance of Prudent Administrative Procedures and Substantive Decisions in Responding to ERISA Benefit Claims

One of the most common and important tasks for ERISA plan fiduciaries is how to appropriately respond to plan participant claims for benefits. When the decision is made to deny benefits to claimants, the importance of having in place prudent protocols and procedures is magnified, and closely following those procedures on an administrative and substantive basis could make a key difference, ...

IRS Announces 2020 Retirement Plan Limitations

The Internal Revenue Service announced cost-of-living adjustments affecting certain dollar limitations for pension plans and other retirement-related limitations for 2020, as detailed in Notice 2019-59. Please click here for a chart that details the 2019 retirement plan dollar limitation cost-of-living adjustments.

Court Rules that IRA Custodian was not a Fiduciary but did Violate MA Consumer Protection Law

In UBS Financial Services, Inc. v. Aliberti (SJC-12662), the Massachusetts Supreme Judicial Court has ruled that no fiduciary relationship existed between the commercial custodian of an individual retirement account (IRA) and a named beneficiary of that account, because the IRA was not a “trust” under either state or federal law, finding that the complaint did not adequately plead sufficient ...