What does the Employee Retirement Income Security Act (ERISA) require for employees handling plan funds?

The Employee Retirement Income Security Act (ERISA) mandates that employees who handle plan funds must be bonded. This bonding requirement is in place to protect the retirement plan from loss in the event that a fiduciary misappropriates funds or engages in dishonest acts. By ensuring that those who have access to or manage plan assets are bonded, ERISA provides a level of security and trust for employees participating in such plans.

The bonding requirement serves as a safeguard for the assets, ensuring that there is financial backing to cover potential losses caused by illegal or unethical actions related to the management of plan funds. This is critical in maintaining the integrity of retirement plans and protecting the interests of plan participants and beneficiaries.