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TransitScreen rundown: Commuter benefits 101

Posted by Natalie Runnerstrom on 7/23/19 12:13 PM

We at TransitScreen love all things commuter benefits. We've covered this topic for quite some time — everything from bikeshare, scooters, pre-tax benefits, and more (even which podcasts to check out during your trip). 

With so much information out there, it can be difficult to find exactly what you're looking for. So, we've created your online bible to commuter benefits. Step into our breakdown of everything you need to know for your company — no matter the size or industry of your business, we've got you covered!

what-you-need-to-know-about-commuter-benefits-rideshare-bikeshare-ridesystems-employee-shuttle-programs-flexible-work-hours-public-transit

LEARN HOW TO ENHANCE THE EMPLOYEE EXPERIENCE THROUGH COMMUTER BENEFITS.

  1. The Basics
    1. Pre-tax benefits
    2. Vanpool/ carpool discounts
    3. Bikeshare memberships
    4. Flexible work hours
  2. The Next Level
    1. Parking cash-out
    2. Transit subsidies
    3. Company-provided shuttles
    4. On-site bike amenities
  3. The Best of the Best
    1. Chicago, IL
    2. New York, NY
    3. Atlanta, GA

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1. The Basics

commuter benefits quote@300x

Let's begin with somethings that you've likely heard of — maybe you're currently offering some of these options or are looking to get started. Currently, New Jersey is the only state to require companies of 20 or more employees to offer commuter benefits. This law became effective March 1, 2019, making the Garden State the first one of 50 to write commuter benefits into state law. 

Washington, DC, New York City, and San Francisco are the three cities also requiring companies with 20 or more employees to offer commuter benefits. Seattle will join this list starting 2020. 

It's not surprising that the cities with some of the most developed public transit systems are the only ones to make commuter benefits a requirement, but will more start to follow in their footsteps as the transportation landscape continues to grow? 

PRE-TAX BENEFITS

Enough policy chat, though — let's talk about what pre-tax benefits are. They're the baseline of any employee commute program, and setting up pre-tax benefits allows employees to take money out of their paychecks before taxes to be added directly to a card from the city’s main transit system. The IRS mandates the upper limit; as of 2019, the maximum allowed is $265/month.

    • Work directly with a transportation management association in your city to get pre-tax benefits started.
    • Larger company? You may want to look into a third-party option to help run your program. It may also be a good idea to have someone in your company dedicated to your commuter benefits.
    • Your employees' taxable income is reduced and payroll taxes will decrease accordingly as well — as high as 9% per employee participating in the program!
    • The job market is only getting more competitive. If you want to attract the best talent, you'll need stay on top of what other companies are offering.
    • At the end of the day, you're looking a more dedicated workforce. They'll feel supported in their commutes, typically one of the biggest stressors for working adults.

VANPOOL/CARPOOL DISCOUNTS

The larger a company becomes, the more likely employees are to live near each other. Help those employees take advantage of their proximity by offering a vanpooling program. Free up more parking spaces, save on carbon emissions, and give employees the opportunity to connect outside of the office.

    • A vanpool program works particularly well in a region where there isn’t as much mass transportation, or if your employees tend to live farther from the downtown city core.
      • For example, housing prices in downtown Seattle are quite high, especially for younger talent. Many of your employees are likely to live around the city as opposed to in the city, so creating carpool/vanpool options will help with any frustrations from longer commutes.
    • You can manage this program either internally or externally, depending on your preference and budget. There are many free ridematching services to help your employees find each other, or even other people commuting to nearby offices.
      • Does your area have slugging? If not, you can request a slug line to start in your neighborhood!
    • Vanpooling gives employees a way to save money on gas, lower their stress (for those who aren’t doing the driving), and get to work faster via access to HOV lanes.
    • You can offer up to $265/month per employee for use of the vanpool program. Much like with pre-tax transit benefits, this lowers costs for payroll taxes for both employees and employers.

BIKESHARE MEMBERSHIPSbike_yellow

Bikes may seem like a new craze to some, but they've been reliable form of transportation for decades now. Pretty much all major cities (and a lot of smaller ones!) have a public bikesharing system in place. Many of these systems offer partnerships with corporate workplaces to provide memberships at a discounted rate to employees.

    • Which bike-related benefits are tax-free? You can make up to $20 in qualified bicycle commuting costs — including things like bicycle repair or purchasing a new helmet.
    • Capital Bikeshare, for example, offers four different program levels — platinum, gold, silver, and bronze — depending on how much of the membership fee the organization chooses to cover.
      • Customizable options let you decide exactly what you need for your current company size and demand.
    • This type of benefit is not tax-free, unfortunately, as of 2019. 
      • Street infrastructure is starting to become more people-friendly rather than car-friendly, and a big part of this change includes cyclists and scooterists.
    • Your workforce isn't buying cars the way previous generations did. Without a personal vehicle, alternate modes of transportation become essential. Having a bikeshare membership ready to go for your employees will only help you appeal more to the masses. 🙌🏽

FLEXIBLE WORK HOURS

Your entire staff doesn't live in the same building, have the same commute, or the same personal life. Offering flexible work hours lets your employees know you value their time in and out office. 

    • A recent Forbes study found employees who work flexible hours were found to be sick less, happier overall, and more productive.
    • 73% of employees found that workplace satisfaction increased with the addition of flexible work hours.
    • This is even more true of millennials. According to a Deloitte study, 16.8% of millennials choose jobs specifically with work-life balance in mind.
      • This is only expected to increase with Generation Z, who will be hitting the workforce in 2019!
    • 11% of people consider flexibility the most important factor in a job.
    • Commuter stress is unbelievably real. Help keep your workers sane and motivated by having flexible work hours
    • According to a Zenefits study, 36% of employees plan to leave their current job in the next year because they do not provide flexible enough arrangements. Make sure your office isn’t one of them!
    • Flexible hours helps staff feel like their personal lives are respected just as much as their work. Offering things like summer hours can actually increase productivity and creativity during the slower months.

2. The Next Level

pillar page quote box@300xPARKING CASH-OUT

The most powerful incentive to offer your employees is simple: more money in their pockets. Employees can either keep a free parking space at work or give it up for a cash payment. This is not a legal requirement in the same way pre-tax benefits are, but it's a popular option many businesses choose to offer in order to stay competitive.

    • You want to make sure you're offering employees the benefits that will lead to the behavior you're hoping for. If you only offer basic pre-tax benefits while still offering free parking, why would someone choose stop driving?
    • Parking cash-outs are the most effective way to decrease the amount of employees who drive to work — up to 20%.
    • Legislation drafted in Washington, DC, would actually require employers who offer their workers free parking to offer the same benefit to employees who walk, bike, or ride transit.
      • This could be hugely effective; 25% of people who use free employer parking in DC only live 2 miles from their office. At this distance, using alternative modes of transit can end up being faster than a car.
    • Employers provide more than 85 million free parking spaces for commuters — which is way too many!
    • Parking is never really free, though. Employers are paying for it, sometimes as much as $2,000/year.
      • Providing free parking can actually cost triple the amount of transit fares or bikeshare memberships 😱.
    • Running out of parking spaces? Renting out your current spots? Maybe you just live in a crowded city and parking is too expensive or difficult to come by? Parking cash-out would lead to an increase in payroll taxes, but you can easily offset those by offering transit benefits simultaneously.
    • What this really helps with is inclusive and equality in the office — everyone has an opportunity to get cash back when they decide not to drive, and that will go a long way with your employees.

TRANSIT SUBSIDIES

Step up your transit game by offering your employees more than just pre-tax benefits. You can actually provide money to employees specifically meant for taking greener modes of transit. Build your program out how you want — finding what makes the most sense for you and your employees!

    • DC-based employees can get up to $265/month tax-free in the form of vouchers or passes for public transit if they don’t have a subsidized parking permit.
    • Pre-tax benefits only cover traditional forms of transit like metro and bus... for now! Subsidies will help your employees stay up to date with the growing mobility landscape.
      • Millennials, who make up a majority of the workforce, and Gen Zers want to take advantage of our changing mobility landscape and work for a company that does, too.
    • Companies like WageWorks can help you allocate a specific amount of money just for transportation options like scooters, e-bikes, bikeshare programs, and rideshare companies.
    • Partner with Uber, Lyft, or other ridesharing apps like Via to give back to your employees, like Segment
      • You can specify this to fit the needs of your company, too. Encourage your employees to practice greener commutes by subsidizing UberPool rides specifically.
      • This allows you to monitor your employees’ transportation habits in one place.

COMPANY-PROVIDED SHUTTLE

commuter benefits blog pull quote@300xIf your office is large enough, you might want to consider more elaborate measures for ensuring a smooth commute. One way is to provide a shuttle for company employees, whether it’s during commute hours or on an emergency ride home basis.

    • If you have a large number of employees who take public transportation from one or two locations, but your office isn’t near those stations, you’d be an ideal candidate for a company shuttle.
    • In Boston, several companies whose offices are in the Seaport District offer shuttles to take employees to North Station and South Station (like Reebok!), which would otherwise be a 30-minute walk. 
    • Do you have a corporate campus? Consider offering shuttles that also take your employees to and from downtown lunch spots. 
    • Large employers whose business involves working off-hours can also consider providing on-demand shuttles for employees who leave work when there may be no public transit options.
      • Hospitals are a great example of this (and you can read more about it in our ebook!)
    • Bonus points! If you provide real-time info about when the shuttle is coming people are far more likely to consider taking a transit option when they feel confident in its reliability, particularly shuttles or buses.
    • Companies like RideSystems or TransLoc can work with you to track your shuttle trips, and we can help you provide this information directly to your employees.

ON-SITE BIKE AMENITIES

It’s one thing to provide bikesharing memberships or safe bike parking on-premises. It’s another to make it possible for employees to seriously consider making the switch by having access to shower facilities in the workplace.

    • Employees are more likely to bike to work if they have access to a shower facility! 
    • People want their rides to be safe while they're in the office, so give your employees a locked, well-lit, and dry storage area for your two-wheeled companions.
    • Consider looking into companies who can come on-site to tune up and repair bicycles for commuters. Even if it’s only once a month, this type of benefit tells your company’s dedicated cyclists you care.

E-SCOOTERS AND BIKES: THE DOCKLESS REVOLUTION

The summer of 2018 might as well have been called the summer of the scooter... at least we called it that! Almost overnight scooters appeared on street corners in multiple major cities and came with some mixed reviews. A year later and you can find multiple scooter companies operating in nearly every state.

    • Millennials and Gen Z aren't buying cars like Americans used to. 
    • Scooters offer a sweat-free option for commuting.
    • Why are they a hit? Well they're fast, fun, and most importantly, dockless. The flexibility to pay as you go and park where it's convenient for you can't be beat. 
    • The introduction of scooters have helped improve and increase bike lanes in major cities, making streets safer and more accessible to people, not cars. 
    • Help your employees cut through the traffic and talk with a scooter company about a partnership.
    • Not much of a talker? You can also setup a stipend that allow each employee to travel the way that makes the most sense for them.

3. The Best of the Best

CHICAGO, IL

McDs shoutout@300xMajor corporations have been changing up their HQs in the past couple of years. Why? Some have been moving across the country to be closer to the talent they seek, while others, like McDonald's, have made more local changes.

In 2018, the hamburger-selling megacorp ditched its suburban home for downtown Chicago. Close to 90% of McDonald's corporate employees didn't want to drive to work, but were very limited in the suburbs. When they began looking for a new home, McD's made the conscious decision to be transit- and health-oriented to provide the best employee experience possible. 

A report from Transportation for America's Capital Ideas found that about 1/3 of McDonald's employees expected to take public transit to the new urban office, but more 90% of their 2,500 employees get to work via public transit. Additionally, the people behind some of the best fries in the world only planned to offer fewer 300 parking spaces where employees have to pay to park.

With the HQ having major train, bus, and rail stations right around the corner, it just made sense to get TransitScreen set up for their employees and visitors!

NEW YORK CITY, NY

Segment's opening statement on their website reads: "We make customer data simple." The company is also making their employees commutes simple, too. We had the pleasure to speak with Laylee Asgari, Workplace Operations Manager at Segment, who handles teams with flexible work schedules. That means employees are coming in and out of the office at different times. Segment isn't exactly a small operation — that's a lot of moving parts. 

Laylee wanted to find a way to truly benefit employees stationed in major cities like NYC. A city with such an expansive transportation landscape has pretty much all the options you need: bikeshare, metro, commuter rail, rideshare, public bus routes, shuttles, vanpool, and ferry! The problem is helping people use them. With there being so many options, things can get confusing and not every choice is super intuitive.

Laylee brought in TransitScreen so that the employees could always be up-to-date on the best to get around no matter the time or location.“TransitScreen started off as a nice amenity, but it quickly became a great value add for our staff,” said Laylee. You can now find TransitScreen in Segment's San Francisco, Vancouver, and Dublin offices as well 😉. 

ATLANTA, GA

Georgia and public transportation may not seem like they go hand in hand, but Atlanta is actually bustling with transit. Livable Buckhead is a nonprofit organization that works to make Buckhead (a popular district in Atlanta) greener, cleaner, and a place that people will want to call home. 

transit methods@300x

They currently offer a free shuttle service, promote and provide clean parks, and work with businesses to build out custom commute programs for their employees needs. One of their biggest partners, Georgia Commute Options, works to offer free support services as well as financial incentives to help companies encourage more sustainable transit options like carpooling, vanpooling, biking, walking, scootering, and even flexible work hours. 

You'll be able to spot a TransitScreen at some of Livable Buckhead's building, too. With so many transit possibilities to choose from, it's helpful to have a tool with all the information you need in one place.

WHAT'S COMMUTING GOT TO DO WITH IT?

As you can see from all of the information above, a lot. Commuter benefits aren't required for a majority of companies across the US, but yet commuting remains one of the biggest pain points for your employees (and probably for you, too). 

Doing more for your employees now will help save you from the millions of dollars that companies spend on turnover every year. Save you and your team from the headache and give your employees the benefits they actually care about.

Topics: TDM, Workplace, Mobility, Employee Experience, Commuter Benefits