The role of a fiduciary can be both broadly and specifically defined, as these individuals are defined by their roles. It may be assumed that a benefits administrator is a fiduciary based on their functions of overseeing an employee plan, but a consultant overseeing a retirement plan for an individual is also considered a fiduciary. As such, a fiduciary liability rests on the nature of the work performed and not a specific job title.
Protect Your Assets
For many businesses, employees are seen as the primary asset. However, fail to accurately or honestly oversee their benefits plan, and you may find that they are more a liability. Employees can file a claim of mismanagement if details or elements of their retirement, healthcare, or wellness package aren’t what was specified upon hire. A clear code of conduct has been drafted for those who act as fiduciaries, and any breach of these rules could lead to a liability claim against the company or fiduciary.
Take Strategic Measures Against Mismanagement
Not only does carrying fiduciary liability aid companies when a claim is brought, but there are many common situations where proactive attention can prevent or reduce potential mismanagement. Automated processing and self-service portals are just a few of the ways to reduce calculation or data error, and third-party benefits management can also devote more time to benefits administration that your company’s small departments.