This week, in Hughes et al. v. Northwestern University et al., the U.S. Supreme Court held that the Employee Retirement Income Security Act (ERISA) imposes a duty of prudence on fiduciaries that includes a continuing duty to monitor investments and remove imprudent investments in a reasonable time. The defined contribution plans at issue each allowed participants to choose their individual investment mix from a menu of options selected by the plan administrators. The Court, nevertheless, found that the diversity of a plan’s investment menu does not excuse imprudent decisions by fiduciaries, even if the menu includes lower cost investments that plan participants sought.
Ballard Spahr attorneys in the Employee Benefits and Executive Compensation Practice Group are prepared to advise retirement plan fiduciaries on how to fulfill their fiduciary duties under ERISA and have written a full alert that explains the Supreme Court’s recent holding. Additionally, our Labor and Employment litigators are prepared to defend plans and fiduciaries facing challenges to their decisions.