Today’s employee benefit plan fiduciaries are under scrutiny due to mismanagement of funds and plans. This is often due to a conjunction of several governmental, legal, and corporate trends.
When a private employer offers benefits including health insurance, retirement, or long term disability insurance, the plans offered must comply with ERISA regulations. ERISA imposes a strict fiduciary duty on those who are managing the benefit plans. If a plan is mismanaged, it may harm plan participants by denying them benefits to which they would have otherwise been entitled.
If you suspect your benefits were unfairly denied, contact a lawyer who is familiar with ERISA breach of fiduciary duty claims in Maryland. A dedicated ERISA lawyer could explore your legal options and stand up for your rights.
The Legal Responsibilities of a Fiduciary Duty Under ERISA
Fiduciaries may include trustees, administrators and any other party who performs functions that grant them control over a benefit plan. While some fiduciaries may be identified as such, others may be held to a fiduciary duty based on their actions regarding the benefit plan.
A fiduciary duty refers to four ERISA governed responsibilities that an appointed individual must follow. The fiduciary typically must manage the benefit plan and perform duties with the exclusive benefit of the plan beneficiaries in mind. Secondly, the fiduciary must manage all plan assets in a prudent manner with skill and care under the circumstances.
If a fiduciary does not have adequate knowledge to make a decision, they must seek assistance. The fiduciary is also tasked with minimizing the risk of loss by diversifying investments. Lastly, the fiduciary must act in accordance with the requirements of the written plan documents under ERISA regulations. A reliable attorney who is well acquainted with
ERISA breach of fiduciary duty claims in Maryland could help a person fight for benefits. A person who is seeking such benefits should reach out as soon as possible to get started on their case.
Determining Liability for Breach of Fiduciary Duty Under ERISA Law
Fiduciary duty is a legal obligation of one party to act in the best interest of another. It is considered the highest standard of care recognized by the law.
If an employer fails to provide crucial information involving a fiduciary duty, the employer may be liable under ERISA. Fiduciary duties under ERISA may include duties derived from common law trust principles. The duty to disclose material information pertaining to benefit plans is the core of a fiduciary’s responsibility.
Employees may have a claim for breach of fiduciary duty if they receive inaccurate information, or lack of important information, when the trustee or employer administrator is aware of that need. Moreover, if a fiduciary misleads plan participants by misrepresenting material information, they may be held liable for breach.
For instance, if a fiduciary fails to disclose to the participant that they are making a high-risk investment with plan assets, the court may find that the failure to disclose this information constitutes a breach of the fiduciary duty.
The cause of action for a breach of fiduciary duty is established by section 502(a)(2) of ERISA, which requires the plaintiff to prove:
- That the defendant was a fiduciary of the benefit plan;
- That the defendant breached their fiduciary duty;
- As a result of such breach, the plan participants suffered losses.
Section 502(a)(2) also creates a private right of action that allows the plan participants to restore the losses to the benefit plan that resulted from the breach of duty. Though individual fiduciaries may be held liable for losses, legal action may be collective, not individual. A proactive attorney who understands these types of cases could help develop a comprehensive legal argument. It is highly advised to seek such legal counsel prior to filing for benefits.
A Qualified Maryland ERISA Lawyer Can Help You with Your Claim
When an employer or other entity breaches their fiduciary duty, plan participants and beneficiaries face the risk of suffering harm, either by losing money in a retirement fund or having their benefits interrupted or delayed.
To learn more about ERISA breach of fiduciary duty claims in Maryland, you should not hesitate to speak with an ERISA attorney today. To learn more, call now.
