Responsibilities of Trustees of Union Pension Plans

by Lexa W. Lee

The trustees of a pension plan manages its assets for the best interests of its beneficiaries, according to Trustees may not manage the plan for their own profit. They assume liability for their actions if, in the course of their trusteeship, they commit a breach of their financial responsibilities.

Pension Plan

A pension plan names fiduciaries or plan managers, who typically include parties like the trustee, investment advisers and the plan's administrative committee. A pension plan is a retirement plan into which an employer contributes funds for the benefit of his employees, upon their retirement. The funds are invested on behalf of the employees.

Trustee Responsibilities

According to the U.S. Department of Labor's Employee Benefits Security Administration (EBSA), one of the primary responsibilities of trustees is to act prudently in the execution of their duties. For example, if they do not have the necessary expertise in any area related to the management of the pension plan, they should hire someone who does, while documenting the process of hiring such a party to ensure that it is prudent.

Other Responsibilities

Other responsibilities of pension plan trustees include: taking actions only in the interest of pension plan participants and beneficiaries, in order to provide them with benefits; following the terms of the plan document, which is the foundation for the operations of the plan; updating the plan document as necessary; diversifying the investments of the plan to minimize the risk of large losses and documenting their investment decisions; and keeping plan expenses reasonable.


Trustees and other fiduciaries of a pension plan who do not adhere to their responsibilities may be required to restore any losses to the plan, or restore profits made through improper use of the plan's assets that occur as a result of their actions.Trustees can limit their liability by documenting their processes in carrying out their duties, and by allowing plan participants to choose among possible investments and give the managers investment instructions. Nonetheless, trustees and other fiduciaries are still responsible for selecting and monitoring investment alternatives offered by the plan.

About the Author

Lexa W. Lee is a New Orleans-based writer with more than 20 years of experience. She has contributed to "Central Nervous System News" and the "Journal of Naturopathic Medicine," as well as several online publications. Lee holds a Bachelor of Science in biology from Reed College, a naturopathic medical degree from the National College of Naturopathic Medicine and served as a postdoctoral researcher in immunology.

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