Do plan managers have special responsibilities?

Yes. Persons who qualify as fiduciaries with respect to employee benefit plans have special responsibilities under the Employee Retirement Income Security Act (ERISA). Failure to meet these responsibilities may result in fiduciary liability.

A fiduciary includes any person who exercises authority over the management of a plan or its assets. The determination of fiduciary status is crucial because once an individual qualifies as a fiduciary, numerous obligations, or duties, apply to that fiduciary.

Fiduciary duties: ERISA imposes various duties on fiduciaries. That is, fiduciaries must manage the plan for the exclusive benefit of participants and beneficiaries, act prudently, diversify plan investments, and abide by plan provisions.

Fiduciary liability: Once an individual who qualifies as a fiduciary breaches his duties, the issue arises as to the scope of liability. Generally, a fiduciary who breaches any fiduciary duty is liable for any losses the plan suffers because of the breach.