“Thus, it appears that the ERISA laws of fiduciary prudence are evolving to require prudence for all investment options individually and the portfolio in the aggregate.”
– Marcia Wagner
Qualified retirement plans are an area of employee benefits that owners and management pay little attention. They do this at great risk to their organization, as seen in the recent Lornez v. Safeway, Inc. case. The company offered its employees a variety of JP Morgan plans presented to them by their plan sponsor. However, employees of Safeway noticed the much lower fee plans were available from Vanguard and sued their employer for not acting in their best interests.
In today’s regulatory climate of what seems like daily changes in technical and legal requirements of employee benefits, employers of all sizes understand that the old client-broker model can leave then out in the cold. Having a consultant with fiduciary duty (read: skin in the game) is not only a trend but is necessary. When was the last time you looked at the fees for your retirement benefits…or made sure your broker was acting in the best interest of your employees?