Plan sponsors have a responsibility to fulfill their fiduciary duty by reviewing investment options and eliminating those options that may not be prudent. In the recent Supreme Court ruling, at its core, this was the consensus in their decision in Hughes vs. Northwestern.
Three Northwestern employees alleged the school, its retirement investment committee, and affiliated officials who administer the plan are in violation of the Employee Retirement Income Security Act of 1974 (ERISA). The allegations in the 2016 lawsuit included the school, et al, did not monitor the recordkeeping fees, offered funds and annuities that had higher fees than comparable share classes and provided too many investment options that were overwhelming to the plan participants.
Our Take Aways for Plan Sponsors Include:
Michael Weddell, an attorney and retirement director at former Willis Tower Watson, advised Plan Sponsors can mitigate lawsuit exposure by:
How DP Grow Can Help
With the detailed fiduciary responsibility assumed by Plan Sponsors, having a knowledgeable and trusted advisor to answer questions is critical. To schedule a consultation with DP Grow, please contact Dennis Tender at 804.729.3819 or email at dtender@dp-grow.com.
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