All plan sponsors need to understand the types of fiduciaries under ERISA. This blog post will discuss the different types and considerations.


Section 405(c)(1)(B) of ERISA allows the delegation to other persons of certain fiduciary responsibilities by the named fiduciary. This means plan sponsors can outsource some of their fiduciary duties, mitigating risk.

Unfortunately, too many plan sponsors don’t understand the types of ERISA Fiduciaries or worse blindly assume a service provider is a fiduciary when they are not.

This leads to retirement plan arrangements having no written agreement and lacking established fiduciary responsibilities for service providers which leaves plan sponsors vulnerable.

It is important to understand the types of fiduciaries and then determine which arrangement would be most appropriate.


Non-Fiduciary – Does not provide investment advice and is not a fiduciary unless they have agreed in writing. Typically the following are not plan fiduciaries: Accountant, Attorney, Financial Advisor, Insurance Broker, Recordkeeper, Third Party Administrator, and Payroll Provider.

3(21) Fiduciary – Provides investment advice, but the plan sponsor is responsible for making the final decision. Often called a “co-fiduciary”.

3(38) Fiduciary – Provides discretionary control over the management of the plan or control of plan assets. Considered the highest level of liability transfer possible under ERISA.

3(16) Administrative Fiduciary – Provides discretionary responsibility for the day-to-day operation and administration of the plan. Plan administration services generally mean reporting and disclosures and NOT investment decisions.


Under all arrangements, a retirement plan sponsor must monitor service providers and can never fully mitigate fiduciary responsibilities. It is important that a fiduciary not assume that if someone is an “advisor” or “consultant” that they are always acting as a fiduciary. Seek a professional for specific advice.