San Francisco (CA) Makes Commuter Benefits Mandatory

San Francisco employers with 20 or more employees will be required to offer commuter benefits to encourage their employees to use public transit or van pools, pursuant to an ordinance signed recently by the city's mayor. Covered employers must provide one of the following three options:

1. Pretax election: a program consistent with Code Sec. 132(f), allowing employees to elect to exclude from income employee commuting costs incurred for transit passes or vanpool charges (but not parking), up to the maximum level allowed by federal law (currently $115);

2. Employer-paid benefit: a program whereby the employer supplies a transit pass for the public transit system requested by each covered employee or reimbursement for equivalent vanpool charges at least equal in value to the purchase price of the appropriate benefit; or

3. Employer-provided transit: transportation furnished by the employer at no cost to the covered employee in a vanpool or bus, or similar multi-passenger vehicle operated by or for the employer.

Covered employee. A covered employee is an employee who:

performed an average of at least 10 hours of work per week for the same employer within the previous calendar month, and
qualifies as an employee entitled to payment of a minimum wage from the employer under the California minimum wage law, or is a participant in a Welfare-to-Work program.

Source: Ordinance No. 199-08, approved August 22, 2008.

Reprinted with permission. © CCH

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