Professional fiduciary services
For the most part, employer associations may pick anyone they want to be a Trustee, subject to the fiduciary duties under the Employee Retirement Income Security Act (ERISA). Responsibilities of fiduciaries are specific whenever the Plan Sponsor chooses ERISA. In general people who do not fully appreciate fiduciary responsibility placed upon them should not accept an appointment as a Trustee – unless they are willing and able to spend the time necessary to be an EFFECTIVE Trustee.
ERISA allows that Trustees should consider “prudent person” rules when accepting an appointment as a fiduciary. The duties of the Administrator which fall upon Trustees may be transferred, to a certain extent, to a professional contract plan administrator.
- Fiduciary responsibility under ERISA
- Delegation of Fiduciary Responsibility
- Plan Administration Options
- Reporting and Disclosure under ERISA
- Communication Techniques
Preparation of detailed financials and use of other plan consultants’ knowledge and the reporting of this information to Trustees on a timely basis is Rule #1 for the professional plan administrator.
The acronym TPA, or Third Party Administrator, should be scrutinized when hiring a Professional Plan Administrator for a health and wealth fare Trust. The term TPA is usually connected to an agency that does not accept (day to day) responsibilities, nor do they accept “named fiduciary status”. The named administrator should be appointed to “carry out the day to day ministerial duties and responsibilities of the Trustee/Fiduciary”.
Professional contract administrators like MVI exist to fulfill obligations of the Trustee while remaining under the guidance of the fiduciaries that must monitor and direct activities of the Professional Plan Administrator.