[Code of Federal Regulations]

[Title 29, Volume 9]

[Revised as of July 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 29CFR2509.75-4]



[Page 349]

 

                             TITLE 29--LABOR

 

 CHAPTER XXV--EMPLOYEE BENEFITS SECURITY ADMINISTRATION, DEPARTMENT OF 

                                  LABOR

 

PART 2509_INTERPRETIVE BULLETINS RELATING TO THE EMPLOYEE RETIREMENT 

INCOME SECURITY ACT OF 1974--Table of Contents

 

Sec.  2509.75-4  Interpretive bulletin relating to indemnification of 

fiduciaries.



    On June 4, 1975, the Department of Labor issued an interpretive 

bulletin, ERISA IB 75-4, announcing the Department's interpretation of 

section 410(a) of the Employee Retirement Income Security Act of 1974, 

insofar as that section relates to indemnification of fiduciaries. 

Section 410(a) states, in relevant part, that ``any provision in an 

agreement or instrument which purports to relieve a fiduciary from 

responsibility or liability for any responsibility, obligation, or duty 

under this part shall be void as against public policy.''

    The Department of Labor interprets this section to permit 

indemnification agreements which do not relieve a fiduciary of 

responsibility or liability under part 4 of title I. Indemnification 

provisions which leave the fiduciary fully responsible and liable, but 

merely permit another party to satisfy any liability incurred by the 

fiduciary in the same manner as insurance purchased under section 

410(b)(3), are therefore not void under section 410(a).

    Examples of such indemnification provisions are:

    (1) Indemnification of a plan fiduciary by (a) an employer, any of 

whose employees are covered by the plan, or an affiliate (as defined in 

section 407(d)(7) of the Act) of such employer, or (b) an employee 

organization, any of whose members are covered by the plan; and

    (2) Indemnification by a plan fiduciary of the fiduciary's employees 

who actually perform the fiduciary services.

    The Department of Labor interprets section 410(a) as rendering void 

any arrangement for indemnification of a fiduciary of an employee 

benefit plan by the plan. Such an arrangement would have the same result 

as an exculpatory clause, in that it would, in effect, relieve the 

fiduciary of responsibility and liability to the plan by abrogating the 

plan's right to recovery from the fiduciary for breaches of fiduciary 

obligations.

    While indemnification arrangements do not contravene the provisions 

of section 410(a), parties entering into an indemnification agreement 

should consider whether the agreement complies with the other provisions 

of part 4 of title I of the Act and with other applicable laws.



[40 FR 31599, July 28, 1975. Redesignated at 41 FR 1906, Jan. 13, 1976]