The U.S. Department of Labor (DOL) is urging a federal appeals court to uphold the dismissal of a lawsuit claiming that an employer misused retirement plan forfeitures.
On January 30, 2026, the DOL filed an amicus brief with the U.S. Court of Appeals for the Third Circuit in Barragan v. Honeywell Intl Inc., asking the court to affirm a lower court s decision in favor of the employer. The case centers on whether the employer plan fiduciary breached its duties by not using forfeited employer contributions to pay plan expenses.
In a press release, the DOL noted that the amicus brief reflects the Secretary of Labor's view that ERISA is designed to set standards of conduct for fiduciaries, and that using forfeited contributions in this way does not necessarily violate the law.
In its filing, the DOL argues that the district court correctly concluded that the plan sponsor did not breach its fiduciary duties of prudence and loyalty. The plaintiff, the DOL says, provided only a bare allegation that forfeitures were not used to pay plan expenses, even though the plan gave fiduciaries discretion over how to allocate those funds.
The brief also notes there is no rule barring plan fiduciaries from allocating forfeited employer contributions to reduce future employer contributions, versus having to use those funds to offset administrative costs.
Source: https://www.dol.gov/newsroom/releases/ebsa/ebsa20260130
Article courtesy of: RPAG
Integrity Benefit Partners
65 LaSalle Rd, Suite 200, West Hartford, CT 06107 | 860.521.401k | www.integritybenefitpartners.com
This material was created to provide accurate and reliable information on the subjects covered. It is not intended to provide specific legal, tax or other professional advice. The services of an appropriate professional should be sought regarding your individual situation. Integrity Benefit Partners and its affiliates do not provide legal or tax services.
Securities and investment advisory services offered through qualified registered representatives of MML Investors Services, LLC. Member SIPC. Integrity Benefit Partners is not a subsidiary or affiliate of MML Investors Services, LLC, or its affiliated companies. 1 Marina Park Drive, 16th Floor, Boston, MA 02116. 617-585-4500. CRN202904-10982840.