- Fiduciary breach;
- Co-fiduciary liability;
- Plan expenses;
- Plan operations;
- Plan investing;
- Prohibited transactions;
- Company securities in a plan, including Employee Stock Ownership Plan ("ESOP") issues;
- Real estate holdings;
- Reporting; and
For regulatory information, click to access the EBSA Enforcement Manual.
In a related online interview for the Professional Liability Underwriting Society ("PLUS"), Chartis Executive Vice President Rhonda Prussack cites financial distress (including the filing for bankruptcy protection) as a significant concern for ERISA fiduciary liability. She adds that a troubled plan sponsor may see the value of company-issued securities plummet which in turn could trigger an ERISA "stock drop" case if such securities are part of the mix for a 401(k) or profit-sharing plan. A company seeking to save cash may switch from a defined benefit plan to a cash balance plan which in turn could pave the way for a lawsuit over allegations relating to the change in design. A company in trouble could shut down factories, instigate large-scale layoffs and/or cut back benefits, all of which lead to unhappy individuals who are more likely to sue. Ms. Prussack emphasizes that happy workers are less likely to sue. She further adds that plan participant actions are likely to take the form of putative class actions.
The bottom line is that there is a long list of potential risk exposures for ERISA fiduciaries and a continued need to mitigate liability.