smart spending

4 ways employers can cut commuting costs

Highlights
  • Reimbursement growing for public transportation costs.
  • Telecommute arrangements cut costs for employees, company.
  • New tax incentive encourages bicycle commutes.

Thankfully, gas prices are decelerating after years of zooming ahead.

Although Americans are enjoying a bit of a temporary reprieve, it's unlikely that rising energy costs -- and growing gas woes -- will go away permanently anytime soon.

Employers are becoming increasingly concerned about these higher costs, says Brigette Flood, marketing manager at UrbanTrans Consultants in Atlanta.

"Employees are feeling the pinch in their wallets and employers are trying to help alleviate the burden," she says. "They know times are tough."

Helping employees cut commuting costs boosts morale and motivation, Flood says. As consumers feel the pinch of an economic slowdown, every dime saved in commuting costs can be applied to other expenses. Worker productivity may even increase if employees are less stressed about their finances.

So creative employees and businesses are coming up with new solutions. Following are four ways employers are helping their workers slash commuting costs.

Cutting costs
Creative employees and businesses are coming up with new ways to cut commuting costs.

Telecommute arrangements 

The MWW Group, a New Jersey-based public relations firm with offices in several states, helps employees cope with rising gas costs.

In June 2008, the MWW Group launched "No Drive Workdays," allowing employees to work from home two days per week. 

If employees absolutely cannot work from home, the company provides gas cards to help relieve price pressures.

Telecommuting is often a win-win for employers and employees.

Without office-related distractions, teleworkers may see productivity increases of anywhere from 10 percent to 20 percent, Flood says. And some teleworkers save hours per day by not commuting.

Telecommuting also helps employers improve their bottom line, according to Flood.

"Employers save on costs such as office space and equipment, employee parking and parking subsidies," Flood says.

Talented professionals flock to telecommuting organizations, primarily because of work-life flexibility, Flood says. Those employees also remain committed to their jobs, she says. 

"Studies show that employees who telework take two to four fewer sick days each year than other employees," Flood says.

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Public transportation breaks 

Tax-free commuter benefits are part of a trend that's been catching on over the past few years. The federal government allows employees to withhold up to $115 annually from pre-tax pay for the purchase of public bus, train or vanpool passes or ticket books.

The number of businesses offering tax-free commuter benefits grew 57 percent in 2007, according to the 2007 Commuter Impact Survey from TransitCenter, a nonprofit commuter benefits provider.

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