As a retirement plan attorney, I can tell you this with certainty: TPAs are rarely sued because they miscalculated a contribution by a few dollars. Math errors happen. The industry knows how to fix them. Lawsuits don’t come from arithmetic—they come from assumptions, silence, and blurred lines of responsibility.
Most TPA litigation starts with communication failures. A plan sponsor believes the TPA is “handling” something—eligibility, forfeitures, corrections, safe harbor status—when in reality the TPA assumed the sponsor was making the decision. That gap is where lawsuits live. Plaintiffs’ attorneys don’t care what the service agreement says if the emails, reports, and conversations suggest reliance.
Another common trigger is scope creep. TPAs pride themselves on being helpful, but “helpful” can quietly morph into discretionary behavior. Explaining options is fine. Recommending a specific correction approach without documenting that it’s a sponsor decision? Dangerous. Especially when that recommendation later turns out to be wrong or incomplete.
Then there’s documentation—or the lack of it. Many TPAs do excellent technical work but fail to clearly memorialize what was decided, by whom, and why. In litigation, if it’s not documented, it didn’t happen. And if the file is thin, the TPA often becomes the most convenient defendant.
Finally, TPAs get pulled into lawsuits because they are perceived as the smartest party in the room. Sponsors rely on that expertise. Courts notice that reliance. And once reliance is established, disclaimers alone don’t save you.
The takeaway isn’t that TPAs should do less. It’s that they must do their work deliberately—with clear boundaries, written confirmations, and an understanding that judgment carries risk.
The calculator won’t get you sued. Everything around it might.
