Using an artificial intelligence tool to get answers to retirement and benefit legal questions could cost a plan sponsor the attorney-client privilege they have always relied on when working with human counsel.
Recent federal court decisions have raised questions about whether communications involving AI remain protected by attorney-client privilege, creating uncertainty for employers, retirement plan sponsors and fiduciaries, all of which are increasingly incorporating generative AI into their day-to-day operations.
The issue has gained urgency as AI adoption accelerates. A 2025 Mercer survey of 225 plan sponsors found that 67% were actively exploring AI to their plan strategy.
Fred Reish, a counsel at the Ferenczy Benefits Law Center and director of ERISA and fiduciary strategy at Prime Capital Financial, says employers should recognize that simply introducing AI into legal workflows could complicate privilege analyses.
Even within corporate environments, Reish says organizations should not assume AI-generated legal discussions will necessarily receive the same protections as traditional attorney communications.
“Generally speaking, there’s an attorney-client privilege,” he says. “But if it becomes so intertwined with artificial intelligence, it’s going to be more difficult to separate it out. Certainly, [for] anything that’s not contained, you’d lose the attorney-client privilege.”
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