Multiemployer Boards of Trustees Face Challenges
The International Foundation of Employee Benefits Plans recently published a report titled Trends in Multiemployer Trustee Boards: 2019 Survey Results, outlining the complexity and challenges individuals face while serving on multiemployer fund boards. The report aggregates information gathered from 233 individuals, including labor and management trustees, plan administrators, and appointing authorities.
While the unavoidable instability of laws and regulations were cited as a challenge by over 90% of respondents, respondents also noted concerns that may be addressed by increased board training and education. A large majority of respondents are concerned about the fiduciary liability faced by trustees (76%) and personal liability faced by trustees (69%). Nearly 70% of respondents were worried about lacking appropriate knowledge or experience regarding fund issues; the same number of respondents was also anxious about losing institutional knowledge when a senior trustee retires. Respondents further reported that they spent an average of 90 hours per year fulfilling their duties as trustees. These hardships perhaps have led to a larger problem: trustee recruitment and retention. Over 25% of respondents stated that recruiting new labor trustees is more difficult than it was five years ago, while nearly 60% of respondents said the same for management trustees.
While over 40% of funds have established a formal orientation, mentoring, or knowledge-transfer process for new trustees, more funds may want to consider implementing similar programs to support trustees as turnover and recruitment becomes a larger problem.