Legal Issues Facing Pension Funds
Robert D. Klausner
Attorney-at-Law
Robert D. Klausner, PA

NCPERS legal counsel Bob Klausner reviewed several of the more significant legal issues that pension funds face. In his presentation he summarized recent case law decisions involving overpayments, fiduciary responsibility, procedures and forfeiture.

Klausner observed that courts continue to focus on defining the role of the fiduciary. In the area of collection of contributions or the recovery of overpayments, the courts tend to liberally construe the board’s ability to make the plan economically sound.

As for more recent issues fund managers face, Klausner said electronic information and commerce present hazards everyone should learn about. The most prevalent example involves the continuation of electronic pension payments after an enrollee dies. Klausner urged administrators to establish a system for coordinating their databases with Social Security lists to identify beneficiaries, noting that families often fail to notify pension funds of such news.

Klausner also warned that pension fund websites have inadvertently presented an opportunity for litigation. Many offer retirement calculators that give examples of pension payments, rather than precise returns on pension investments. Some funds have been sued by enrollees who said that their fund website failed to clearly indicate that the information is an example or estimate.

Klausner has represented public employee pension funds since 1979. He also consults with numerous state and local governments on pension issues.