How Actions of Plan Administrators Jeopardize Your Rights to Employer-Provided Benefits

Benefits provided through your employer play a vital role in protecting you and your family. They can comprise a considerable portion of the overall compensation you receive on the job, and they often represent years of work and your own financial contributions. Plan administrators have a fiduciary duty to manage these plans wisely so that benefits will be there when you need them. When they breach fiduciary duties, you have the right to file a claim.  

Fiduciary Duties of Plan Administrators

Employer-provided benefits often include group health plans, short and long term disability insurance, life insurance, and pension, stock sharing, or retirement benefits. These protect you when unexpected events happen and help to ensure you are provided for in the future. Monthly premium payments and contributions to benefit plans are often shared between employers and employees.  

Plan administrators play a major role in managing benefits, collecting premiums, and keeping policies up to date. In this role, they have a fiduciary duty that carries certain responsibilities. Under guidelines from the Department of Labor (DOL), this includes:

• Acting solely in the best interests of plan participants and their beneficiaries;
• Serving the exclusive purpose of providing benefits to them;
• Following provisions set forth in benefit plan documents, which should be distributed to employees;
• Holding any plans assets that exist in trust;
• Investing in plans wisely and paying only reasonable expenses. 

When Employee Benefit Plan Administrators Breach Their Duties

When plan administrators fail to act prudently and breach their fiduciary duties, it can have serious ramifications for employees. After paying into plans for years, you could find yourself facing the following: 

• Persistent problems in filing and resolving claims;
• Excessive restrictions that make it impossible to obtain benefits;
• Inadequate coverage and lapsed policies;
• Mismanagement of funds and depletion of plan assets. 

This could mean that health, disability, or life insurance is not there when you need it. It could also result in the loss of any pension or retirement benefits to which you would otherwise be entitled. For employees in this situation, the results can be devastating. Fortunately, there are federal laws in place designed to protect you.

The Employee Retirement Income Security Act of 1974 does not require employers to provide benefits, but it does provide rules and regulations regarding how they are administered. When a plan administrator breaches their fiduciary duties, ERISA provides legal recourse to the employee involved, which includes the right to file a claim seeking compensation for any losses suffered. 

Our Chicago ERISA Lawyer is on Your Side

When plan administrators breach their fiduciary duties, Bartolic Law holds them accountable. Call or contact our Chicago ERISA lawyer today to request a consultation.