‘To Do’ List Not Erased by Plan Admin Outsourcing
Outsourcing plan administration is not new. And it can be more than a matter of mere convenience, since it offers assistance in meeting increasingly complicated regulatory and administrative requirements. But it’s not a full absolution from all responsibilities, argues Fiduciary Plan Governance in a recent blog entry
Outsourcing plan administration can help to ensure that a plan is well-managed, serves employees well and ease an employer’s workload and expenditures of overhead and time, says Fiduciary Plan Guidance. Still, they say, even with outsourcing there are functions an employer must perform. It still must:
- keep careful watch over how the party hired is administering the plan, since you retain ultimate responsibility for making sure the administrator is acting prudently;
- independently evaluate how suitable the administrator’s actions, expenses and overall performance; and
- remember that it holds the ultimate decision-making authority for hiring and firing.
Delegating fiduciary and plan management duties to a 3(16) plan administrator is the “most complete” delegation that can be made, Fiduciary Plan Guidance says. But even if an employer does so, they argue, an employer still has responsibility — at the very least, to keep track of how well that administrator is performing its duties.