Dealing with Tough Times at Work–Part II

Yesterday, we considered addressing an employee’s financial anxiety concerns.  Today, let’s look at direct impact.  Since an economic downturn affects employers as well as employees, employer options for mitigating the direct economic effects on employees are often limited.  But there are some things worth considering.

Higher gas prices — A recent election poll conducted by Lake Research Partners for a labor group called Change To Win revealed that the rising cost of gas was of greatest concern to employees.  What can employers do about that?

– Allow telecommuting where possible;

– Provide employees with gift cards for gas (which has tax and overtime pay calculation implications);

– Allow employees to buy gas at reduced rates from company-owned pumping stations;

– Use four day per week, ten hours per day scheduling (or three day per week, 12 hours per day) to reduce the number of commutes an employee makes in a week;

– Promote an employer-paid transportation benefit that takes advantage of tax incentives by which employers pay for their employees to commute by transit or van pool (up to $115 per month) with the employer receiving a tax deduction in accordance with the Transportation Equity Act for the 21st Century.

Absence of available cash or credit for major purchases — Approximately 11% of employers provide down payment assistance programs, approximately 19% provide rental assistance programs, and approximately 12% provide mortgage assistance programs.  While such efforts have been largely reserved for coveted employees in high-paying industries, a bill is pending in the U.S. Senate to provide up to $10,000 per year in nontaxable income for employee housing.  Moreover, state and local governments have programs that give employers tax credit for participating in employer-assisted housing efforts.

Some employers have helped charter credit unions for their employees to provide for a less expensive banking option.  The Coca-Cola Family Federal Credit Union is an example.

Generally less buying power – How can employers address this piece of employee pain?

– Employers who make consumer goods sometimes provide their products to employees at no or minimal cost (which has tax and overtime pay calculation implications).

– Employers who have relationships as vendors or customers of large retailers or manufacturers of consumer goods may be able to get “employee discounts” from the retailers or manufacturers.  In fact, if an employer is a big enough vendor or customer, a retailer or manufacturer might seek out the employer and offer discounts to employees who are viewed as a “captive audience.”  It’s important, however, for human resources to carefully screen actual bargains from efforts to get an employer to run a targeted marketing campaign on the cheap.

– Some employers also provide auto, home, and life insurance programs as additional low-cost, high-value voluntary benefits from other companies.

– Where financially feasible, an employer can give employees annual raises that cover or exceed the rise in the Consumer Price Index or similar inflation tracking indices, which would go beyond the compensation practices of most employers.

– Where financially feasible, an employer can absorb increases in health care costs.

Tomorrow, employer-pride concerns will be the topic.