I like bagels as much as the next person. But breakfast meetings do not equal fiduciary protection.
Plan sponsors often assume that because their recordkeeper provides education sessions, quarterly reports, and cheerful service reps, someone else is “handling the fiduciary stuff.” That’s a dangerous assumption.
Most recordkeepers are service providers. They are not fiduciaries unless they explicitly agree in writing to act as one under ERISA. And even then, you need to understand whether they are acting as a 3(21) co-fiduciary, a 3(38) investment manager, or merely providing administrative support.
Those labels matter.
If you retain discretion over selecting and monitoring investments, you are a fiduciary. If you decide which fees to pass along to participants, you are a fiduciary. If you appoint and monitor service providers, you are a fiduciary.
Outsourcing services does not outsource responsibility.
Too many committees treat quarterly review meetings like vendor updates instead of governance sessions. The recordkeeper reports performance; everyone nods; someone asks about participant engagement; meeting adjourned. That is not fiduciary oversight.
You must review fees independently. You must document decisions. You must understand what your service agreements actually say.
ERISA doesn’t care how friendly your relationship is. It cares about process and prudence.
Bagels are nice. Written fiduciary agreements are better.
