Commuter Benefits: A Win-Win for Employers and Employees

In the fast-paced world of work, where every perk and benefit counts, commuter benefits have emerged as a strategic and mutually advantageous tool for both employers and employees. This often-overlooked offering can significantly impact job satisfaction, productivity, and even the company's bottom line. Regardless of whether you provide this benefit as a state or regional requirement, or if a commuter spending account is offered as an additional benefit, it's good for both you and your employees.

A commuter spending account allows employees to deduct a chosen amount from their paychecks on a pre-tax basis. Card technology and tap to pay make the benefit even easier to manage - especially when employees can use the same card for all their consumer accounts. 

Transit funds can be set aside in commuter spending accounts for pre-tax spending on part or all of the cost of bus, subway, train, trolley, ferry and light rail passes, as well as verified carpooling programs, such as a metro vanpool, and ridesharing programs like UberPool and Lyft. Parking funds may be used to pay for work-related parking expenses, such as parking garages/lots, meters and parking expenses incurred near a transit station. 

Based on a $300/month transit account contribution, the estimated savings for an employee that makes $60,000 annually with commuter benefits can be as much as $1,584 per year, just for setting aside that pre-tax money for transit expenses.

Let's explore the compelling benefits that extend to both sides of the employment equation:

For Employees:

Cost Savings: Commuting expenses can quickly add up, from fuel and public transportation fares to parking fees. Commuter benefits provide employees with tax-free dollars to cover these costs, offering a tangible financial perk that directly impacts their take-home pay.

Reduced Stress: Long commutes and transportation expenses can be a significant source of stress for employees. By offering commuter benefits, employers contribute to a healthier work-life balance and support their staff in minimizing the stress associated with daily travel.

Environmental Impact: Opting for public transportation or carpooling not only reduces commuting costs but also has a positive impact on the environment. Employees can feel proud that their employer supports eco-friendly commuting choices.

For Employers:

Talent Attraction and Retention: In a competitive job market, offering commuter benefits can set a company apart as an employer of choice. Prospective hires may see these benefits as an added incentive to join the team, while current employees are more likely to stay with a company that invests in their well-being.

Productivity Boost: Reduced stress and financial worries translate to a more focused and engaged workforce. Employees are likely to start their workday on a positive note when they don't have the added burden of navigating expensive and stressful commutes.

Tax Advantages: Employers offering commuter benefits may also benefit from tax advantages. In some regions, these programs can result in lower payroll taxes, contributing to overall cost savings for the company.

Commuter benefits are not just about getting from point A to point B. They represent a strategic investment in the well-being and satisfaction of both employer and employee. By acknowledging the challenges of commuting and providing practical solutions, companies can foster a positive workplace environment that pays dividends in loyalty, productivity, and overall success. Ask your broker about adding a commuter benefit to your benefits program.