ERISA Fiduciary Breach Claims Against Smaller Plans Increase in 2018

A growing number of lawsuits have targeted 401(k) and pension plans. These lawsuits are driven by a number of factors such as the 2008 financial crisis, a recent decision by the U.S. Supreme Court, some larger cases on the topic settling for significant sums, and an increased focus on lower management fees. As plaintiffs’ attorneys noticed the reductions in plan fees and the successful litigation on the part of large Read More

ESOP Fiduciaries and ERISA Compliance

The Employment Retirement Income Security Act of 1974 (ERISA) sets the minimum standards for many retirement and health plans. This includes employee stock ownership plans or ESOPs. In fact, ESOP fiduciaries must pay particular attention to rules and standards of conduct. The Role of ERISA Fiduciaries Anyone with authority or control of ESOP plan assets, or who participates in management or administration of the Read More

Fiduciary Liability Cases Soar as ERISA Retirement Assets Reach $28 Trillion

Fiduciaries manage assets on behalf of other individuals, like participants in retirement and health care plans. As such, fiduciaries have an ethical duty to act in the best interests of the beneficiaries they represent. In fact, they can be held liable for their actions. But what happens when beneficiaries lose confidence in fiduciaries? Lately, the answer seems to lie in the increasing number of fiduciary liability Read More

Best Steps to Avoid a Cyber Attack on Your 401(k) Plan

With everything from pizza deliveries to multi-million dollar deals being handled online, it should come as no surprise that hackers might target you 401(k) plan. However, security breaches don’t stop with an unknown party simply accessing your participants’ personally identifiable information (PII). Hacks also can lead to unauthorized withdrawals of funds from 401(k) plans. So, what can you do to avoid a cyberattack Read More

Tax-Exempt Entities Receive IRS Guidance on Executive Compensation Excise Tax

The Tax Cuts and Jobs Act (“TCJA”) enacted in December 2017 offered welcome tax relief to many American taxpayers. However, the TCJA also created headaches for tax-exempt entities in the form of a 21% excise tax on certain types of executive compensation programs. Organizations like churches, charities, social clubs, veterans’ organizations, certain trusts, and agricultural organization had to quickly learn how to Read More

Is Simultaneous Sponsorship of an FSA, HRA, and HSA Possible?

Employers struggling to offer the health and welfare benefits employees prefer may find that certain options do not mix well. In fact, employers may wonder if simultaneous sponsorship of an FSA, HRA, and HSA is possible or even preferable. The first and most important decision to make is whether it is possible to supplement health insurance with FSAs, HRAs, and HSAs under current laws. Publication 969, Health Savings Read More

Avoiding Fiduciary Liability in 2019: Steps 401(k) Fiduciaries Should Take Now

Plan fiduciaries, regardless of their title, are expected to perform their duties solely in the best interests of plan participants and their beneficiaries. In addition, plan fiduciaries are expected to act prudently. Failing to do so, and failing to comply with Department of Labor (DOL) fiduciary responsibilities, can lead to a fiduciary liability lawsuit. What follows are actionable suggestions on avoiding Read More

New Democrats in the House Address ACA Litigation and Three Other Policy Issues

The majority party in the United States House of Representatives (the “House”) generally sets the tone for the coming two-year Congressional session. In 2019, for the first time since 2010, the Democratic Party is the majority party. As such, they are responsible for proposing House Rules (the “Rules”) that determine how the House will operate. Among other issues, the new Rules address ACA litigation and three other Read More

Recent Updates to U.S. Equity Compensation FAQs

Institutional Shareholder Services (ISS) maintains a comprehensive list of U.S. Equity Compensation FAQs. On December 19, 2018, ISS issued updates to its FAQs based, in part, on recent changes to the Internal Revenue Code of 1984, as amended (the “Code”) and the Tax Cuts and Jobs Act of 2017 (“TCJA”).   Effect of Section 162(m) Deduction Removal on Compensation Programs Removal of Section 162(m) of the Code Read More