Education and advice under ERISA for employee-directed 401 (k) plans
Article Abstract:
Section 404(c) regulation established the conditions that plan fiduciaries must meet to be absolved of liability for the consequences of employees' control over their accounts. An employer that desires to provide its employees with education and advice services through a third party should be able to do so while still obtaining reliance on the protections of 404(c) and without taking on significant additional fiduciary responsibilities. But that exposure to co-fiduciary liability can be alleviated by the prudent selection and monitoring of the advice giver. The plaintiff in a case against an employer engaging an education provider would have a very heavy burden. The plaintiff in a case against an employer engaging an advice provider would have an easier burden because the question of whether the service was advice, having been admitted by the employer, would not be an issue. However, the plaintiff's burden would still be significant in that it would have to prove that the employer both knew that the advice was imprudent.
Publication Name: Benefits Quarterly
Subject: Human resources and labor relations
ISSN: 8756-1263
Year: 2000
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Sounds great, but what's in it for me? Helping employees understand their role in the retirement planning process
Article Abstract:
Communication of retirement plans by employers to their workers has improved substantially, but in many cases still is inadequate in getting workers to comprehend their roles in planning for their own retirement. It is important to educate ones employees about the retirement planning process. Each employee is targeting retirement at age 65. A properly designed, personalized communications program can educate each employee about the importance savings and investing will have on his or her ability to retire. Once employees understand they have a role in the retirement planning process, they are more likely to be financially prepared to retire. A traditional defined benefit plan offers a lifetime benefit to an employee upon retirement. As long as the retired employee is living, the plan must pay the benefit. Therefore, the employer is responsible for the continued payment of the retirement benefit.
Publication Name: Benefits Quarterly
Subject: Human resources and labor relations
ISSN: 8756-1263
Year: 2000
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Educating employees on defined contribution health care: The time is right for an employee-empowering approach
Article Abstract:
The article discusses how the defined contribution approach can be applied to health care. The challenge a company faces in introducing a defined contribution approach is similar to announcing any benefits change. Introducing any health care benefit change, including a defined contribution approach, to an employee population requires careful handling. A corporate culture that currently supports independent employee decision making, and is equipped to provide easy access to health care information tools, is in the best position to make the transition to defined contribution health care options. A straightforward communication approach, coupled with a strong emphasis on employee involvement, should help health plan participants not only become comfortable with the defined contribution concept but maximize its true benefits. Employers that establish a defined contribution program will do more than manage costs and minimize liability. They will be providing the best approach for creating limitless health plan options for employees ready to assume an active role in their future health and well being.
Publication Name: Benefits Quarterly
Subject: Human resources and labor relations
ISSN: 8756-1263
Year: 2000
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