If your company employs 20 or more full time, non-union employees in any of the five boroughs of New York City, offering a pretax transit benefit is the law. And it’s been a little over two years since “Local Law 53”, New York City’s Commuter Benefits Law, went into effect.
But, it’s not too late to comply with this transit ordinance and avoid any penalty that can hurt your company’s budget. In this article we answered the most frequently asked questions about complying with the NYC Transit Ordinance.
What is the NYC Transit Ordinance?
The NYC Transit Ordinance, Local Law 53 (Intro 295-A), is a transit benefit ordinance requiring New York City employers with 20 or more full-time employees to offer pre-tax transit benefits. The law was signed into law by Mayor De Blasio on October 20, 2014.
Who is considered a full-time employee?
The law defines a full-time employee as someone who works on average 30 hours or more per week for an employer.
Are there any exemptions?
Yes, federal, state, and local government entities and those employers “where a collective bargaining agreement exists between any group of employees and an employer.”
However, at companies where the number of full-time employees not covered by a bargaining agreement is 20 or more, those employees that are not covered must be offered the benefit. There is a third exemption for companies that are not required by law to pay federal, state, and city payroll taxes.
When did law this go into effect?
The NYC Transit Ordinance went into effect on January 1, 2016. Any company that doesn’t comply will be subject to a civil penalty. If found in violation of the Ordinance employers will have 90 days to comply before any penalties are imposed.
What is the penalty for failing to comply?
First violation penalties will range between $100 and $250. Any subsequent violations will cost $250 for each month (or 30 days) the company is not in compliance.
Are the penalties per company or per employee?
Employers have 90 days to fix violations before penalties are imposed? How does that work? If you are fined for failing to comply with the NYC Ordinance, you will have 90 days to comply in order to avoid the penalty.
What happens if a company doesn’t comply within that 90-day window?
Any company that doesn’t comply during the 90-day violation window will be charged with a subsequent violation and will have to pay an additional $250 penalty every 30 days until compliance is completed.
Who will enforce the NYC Transit Ordinance?
The Department of Consumer Affairs will be administering this law. My business is headquartered outside of New York City.
Does the Ordinance still apply?
It depends on whether or not you have offices in New York City. If you have 20 or more employees that work in the 5 boroughs, then yes, the Ordinance applies to your company.
Does this Ordinance cover employees that commute into the city from the suburbs?
Yes, if you have employees commuting from the suburbs to an office in one of the 5 boroughs, then yes, it includes them.
How to Start a Commuter Benefits Program?
There are a variety of ways to make saving with commuter benefits a reality, depending on the size of your business, the number of employees and other factors that would be unique to your organization.
As the nation’s leading provider of commuter benefits programs, we offer the simplest and easiest solution for employers to abide by the New York City commuter benefits law. And we do it in just four steps. Take a look:
Sign up: Book a 15 minute meeting. If you prefer, you can call at 800.531.2828.
Complete registration: Register your company on our platform. Don’t worry, we’ll guide you every step of the way!
Upload your eligibility roster: Upload your list of employees into the system
Pass out our sign up guide: Our custom-made sign up guide takes you out of the mix by walking employees through creating their user accounts and selecting their monthly benefit elections.
We also provide educational materials to help you engage your employees to successfully join the program.
Ready to take action?
If you want to learn more about commuter benefits, download the 101 Guide below: