Official Rules Against Union Use Of Plan Assets

Sections 404(a)(1)(A) and (B) of ERISA require plan fiduciaries to discharge their duties “prudently and solely for the exclusive purpose of providing benefits to participants and beneficiaries and defraying reasonable expenses of administering the plan,” Doyle writes.

Fiduciaries cannot interpret that requirement to permit them to promote other public policy goals on the ground that anything that helps the national economy helps plan participants, Doyle writes.

“A fiduciary may only consider factors relating to the interests of plan participants and beneficiaries in their retirement income,” Doyle writes.

When, for example, a fiduciary decides whether to invest the plan sponsor’s industry, the decision “may not be influenced by a desire to promote a particular industry or industry member, or to generate employment within that industry or industry member, unless the investment, when judged solely on the basis of its economic value to the plan, would clearly be equal or superior to alternative investments available to the plan,” Doyle writes.

The U.S. Labor Department believes using pension plan assets to further collective bargaining objectives subordinates the interests of plan participants to other interests, Doyle writes.