Acting on the belief that time is money and that employees who are free from personal worries are more productive than others, innovative employers are sponsoring the following types of personal benefits:
- Dry cleaning pick-up and drop-off service;
- Washing and servicing the car;
- Providing access to pet health insurance, veterinary services, and pet products;
- Standing in line (e.g., for tickets);
- Making appointments;
- Arranging for housecleaning and other services;
- Having the mail room handle employees' packages (for the price of postage);
- Buying event tickets in blocks (at a discount);
- Packing hot meals from the company cafeteria for employees to take home or serving complimentary dinners (to entice employees to work late);
- Having employees' prescriptions filled at local pharmacies;
- Having a sitter at an employee's home to await repair services and deliveries;
- Sponsoring group participation and rates for oil changes, routine car maintenance, or detailing (in the employer’s parking lot); and
- Arranging for and picking up birthday cakes, gifts, cards, and flowers.
Whether offered through direct relationships with local businesses or through national concierge services, these benefits meet employee needs while supporting corporate objectives. In fact, concierge and personal business benefits are often offered as an employee-pay-all service because of their perceived high value.
If an employer chooses to subsidize any benefits for services or coverage listed above, it must determine whether such assistance results in taxable income to the employee. Generally, the employer-paid portion will be taxable unless the Internal Revenue Code specifically excludes it. For example, currently there is no federal tax exclusion for pet insurance. If the employer pays a portion of the insurance premium, that amount is taxable and tax withholding is required on the employer-paid subsidy. For some benefits listed above, the working condition fringe benefit or de minimis exclusion may apply. To make certain, HR professionals should consult with a knowledgeable tax expert.
Source: Mandated Benefits Compliance Guide, Concierge and Personal Business Benefits, §10.12, The Balser Group.