What Are the Fiduciary Duties Under ERISA?

You must discharge your duties with respect to a plan solely in the interest of the participants and beneficiaries.

You must carry out these responsibilities for the exclusive purpose of providing benefits to participants and their beneficiaries and defraying reasonable expenses of administering the plan.

When managing a plan, you are held to a prudent man standard of care. This requires you to act with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. Additionally, you must diversify the investments of the plan to minimize the risk of large losses, unless it is clearly prudent not to do so under the circumstances. Finally, you must operate in accordance with the documents and instruments governing the plan, provided those documents are consistent with the applicable legal provisions.

If you are a fiduciary who breaches any of the responsibilities, obligations, or duties imposed upon fiduciaries, you face significant personal liability.

You are personally liable to make good to the plan any losses resulting from each breach and to restore to the plan any profits you made through the use of plan assets. Furthermore, you are subject to other equitable or remedial relief that a court may deem appropriate, including your removal as a fiduciary. You can also be removed for a violation involving certain prohibited individuals.

Your liability is strictly limited to the time you serve in the role; you are not liable for a breach of fiduciary duty if the breach was committed before you became a fiduciary or after you ceased to be one.

You may also be held liable for the breach of a co-fiduciary with respect to the same plan under specific circumstances. You can be held accountable for another fiduciary's breach if:

• You knowingly participate in or knowingly conceal an act or omission of another fiduciary while knowing that it is a breach.
• Your failure to comply with your own specific fiduciary responsibilities enables another fiduciary to commit a breach.
• You have knowledge of a breach by another fiduciary and fail to make reasonable efforts under the circumstances to remedy the breach.