How would you compensate employees for commuting to work?
How would you compensate employees for commuting to work?
Suppose there are two employees: Alice and Bob, who do the same job at the same factory. Alice has a 10 minute (20RT) commute, Bob commutes 35 minutes(70RT).
If you're the owner of the factory, would you compensate them for their commutes? How would you do it?
In my opinion, I don't think employees should be compensated for their commute. How an employee chooses to arrive to work and how far they live away from a company is not a responsibility of the company. Their job is to be ready to work when their shift starts.
However, this is an X-Y question. The overwhelming majority of jobs historically required you to show up to work. We didn't consider paying for their commute unless they had to travel for work outside of commuting. This was never an issue.
You asked the "X" question, but the "Y" question (the question you're probably asking) is how the burden of commuting should be handled for employees being asked to come in when they have been working remotely.
I think that there are many more nuances to this than simply compensation. If the employee has a working agreement with the company, and they have been managing their time with full-time remote hours, then they should consider that as part of the work agreement.
If they're being asked to come in (when they would normally be WFH), that's outside of the work agreement. It's basically like being asked to get coffee for your boss or something. If it was advertised as part of the job, and you accepted it, then that's fine. If you started work, and a year later, your boss asks you for daily coffee runs under the threat of being fired, that is not acceptable.
You have to keep in mind that the recent WFH popularity has challenged a lot of companies by making their own interests difficult. A lot of it is shitty stuff that the company doesn't want to say out loud, like:
- They cannot walk around and micromanage you
- They cannot watch you work
- They don't like the idea of taking breaks, even if you put in the same amount of work throughout the day
- They don't have that corporate appearance of an office of business casual-dressed employees
- They have real estate they paid for that is sitting half-empty
This kind of thing. Realistically, from an employee perspective, they're doing the same work, and they don't see any issue hanging around their house in their pajamas. From a higher-up perspective at some companies, though, they don't have the same goals.
It makes sense that a lot of employees are leaving their positions with companies forcing them to come into the office. In my opinion, they're breaking their working agreement. It may not be written down and it may not be a legal difference, but there is no doubt that they're radically changing the work requirements, which might not be what they signed up for. And what if you're in a wheelchair?
Unfortunately, if Alice and Bob live in the US, there is hardly any hope for them if the company doesn't have goodness in its heart. The workers' rights laws in the US are almost non-existent. There are even about three dozen states that can even legally fire you for being gay. It's that bad.
In my opinion, workers' rights should be highlighted, and side effects like working agreements and compensation for commuting should be solved problems by proxy.
I would put then on the same shift so they eat lunch together. Soon they will fall in love, get married and move in together. Problem solved.
It's none of the company's business how an employee gets to work. It's just not.
The company should compensate the employee fairly or well for the COL in the area the job is. That's it. It's not their job to worry about how the employee gets to work.
Other than allowing/encouraging WFH where it makes sense the company shouldn't try to tell the employees how to live.
Anything short of my commuting time being considered part of my working hours is a non-starter for me. I value the time I gain by not commuting a lot more than most employers do. If my day starts the moment I close my front door, then we can start talking about additional concessions.
Any compensation for commuting to your regular work place is considered taxable income.
The government allows for a tax deduction if commuting costs exceed a certain amount.
I would not do anything about it as is the custom in Sweden. If they want to change it their union can negotiate it, but they are generally more interested a bigger raise than misc benefits.
In the U.S., employers can subsidize bus passes, van pools, and bicycling to work (I guess provide bikes?) as a tax-free benefit. I'd certainly offer that.
I would not provide more $ to the employee who took a job further from home, unless I was doing on-site jobs on various job sites, work that moved around. Events, construction, etc. My employer pays for airfare or mileage for event work, that is not taxable to the employees.
Even when I did temp work I wouldn't take jobs far from my house, or any that were not one bus away, even though I have a car because cars break sometimes.
I DO think of commute time in a car as unpaid work but manage that in my life by working near home, or living near work.
Paying them using time is a mistake in my opinion. Instead, we should use mileage. By using mileage instead of time, we make sure they still get paid for their commute, but also they don't get paid extra for sitting in traffic or while waiting for the bus. Setting a mileage cutoff to prevent abuse would also be a good idea, say 30 miles round trip is paid for, the rest is on your own time. We could also pay for public transit expenses to encourage public transit use, if available.
My employer gives us a commuting payment based on the distance from home to work (paid per km) on days we go to the office. We get an additional €60 a month to cover our working from home costs.
It's dependent on how competitive the job market is. You either pay the person more to get them to do it or you don't. You set a value on their relative skills. Everything else comes out in the wash.
I commute an hour, but I only do so because it's cheaper to live where I do instead of in the city I work in. I'm already compensated.
If I wanted a short commute I would be paying for it.
First: a company should pay at a minimum a wage that can afford housing nearby (probably within 15 minutes' drive). The company should pay everyone for work hours + that round trip nearby commute time
If the company is paying that wage, then employees who live farther away are making a free choice to do so. They still get that round trip nearby commute time paid, but time beyond that is not paid. Or paid at some diminishing rate.
Companies should recognize a worker's time list for the company's benefit. But there has to be a balance because of the temptation to game the system.
If they can take public transit I'd pay for it. I'd give them up to $2,000 hiring bonus to buy an electric bike (maybe find a good company and get a discount) and offer relocation fees to get within range of either. If you're driving, use park and ride and I'll pay for it.
Other than that, WFH.
I wouldn't. Where you choose to live, and where you choose to work are both personal choices, and thus should be your own burden to bear.
The easiest two ways are to either pay per mile, or just add the round trip time to whatever their pay is. There might be some small complaints and attempts to abuse. But the complaining is easy to deal with and I think the abuse would be small and could be dealt with in similar ways as other time theft is dealt with.
Government has power to put it on trial.
- Revitalize public transportation, adjust timetables to usual starts\ends of shifts;
- Make dumb paycards to pay-per-ride, consequential rides counting as one (if one needs to jump them);
- Public sector employees, essential ones first, get 2 rides per working day monthly, to go there and back;
- After getting some stats, make it equal to N litres of gasoline in $, tax-free, promote paying with it on gas stations and for government's services. No easy conversion to cash tho, not at the start at least, so it won't be seen as free money, worthy a fraud.
As a public test, it'd show if it works. Then, it can be pushed onto students, then on other spheres.
Then, as a large amount of workers has this benefit, it's not a wet dream but a real thing to consider and demand. One that private businesses would see.
I do find that not paying for commute has a good competitive value. It means I start to earn money right from the time I clock in, not spending my first minutes to compensate getting there – and that's a bitch for low-paid workers. Compared to those working from home, I still wake up earlier and am trapped on company's ground, but it's a first step to bridge and accept this difference.
In some cities I visited (ex-socblock) some big factories provide their own transport to take workers from their district and then bring them back. Since they are based way out of cities' limits due to health concerns, it's an obvious solution to that. By managing the commute of workers, factory may also be sure everyone in production line gets there at the same time, reaching full efficiency.
Let's make generalizations to answer the bigger problem here.
Most jobs that people are talking about are in cities.
Some people choose to not live right in the middle of a city for various reasons, but still want that job. They may live in a nearby community, the edge of the city, a county or two over, etc.
Predatory companies like Amazon resolve this by telling someone like Ryan homes to build a few 300 house communities right next to their new warehouse, resolving the issue and making their own non-city town. Normal companies do not have this ability.
There has to be a balance.
Businesses need to not be involved in commute repayment. They should instead invest into their local communities to make them more desirable to live in.
Half assed ideas.
Option 1) % of hourly pay rate, capped at an two hours for a total round trip (but flexible) + a stipend depending on mode of transportation. Could try to get receipts from workers and have a purser issue cash/credit on their next paycheck or issue re loadable debit cards that get filled at regular intervals. (So a card for paid public transit and fuel for combustion vehicles) If we're working in a place that taxes employee wages, the more taxes the employer can carry the better on the workers.
Option 2) Everybody gets a debit card and a list of approved places/items to be purchased for the purposes of "commuting to work compensation". Workers could be expected to keep as many receipts as possible to turn in weekly just to verify stuff.
Option 3) Some subcommittee tracks worker commute times and how they commute and every quarter or something a stipend is paid in a lump sum like a bonus or it is used to give a paycheck by paycheck payout.
Easiest idea would be like JohanSkullcrusher said, full hourly pay rate the second I get into my car to start driving. Though workers would wind up paying more in income taxes and there'd probably be some issues with workers getting different compensation, like somebody walking 10 minutes to work and somebody driving 1 hour to get to work are going to have significantly different income levels at the end of the year.
If I am travelling to a location purely to do my job at that location, then travelling to that location is part of my job. I must be reasonably compensated for it either as part of my salary or as an extra (tax adjusted) payment.
Switch the pronouns and such to apply for Bob and Alice both.
I'll offer Bob a place near the workplace if he's a good employee. If he asks me to pay for his transportation expenses, it won't happen. I think I'd formally invite him to find another job at the end of the contract.
If I were to do it, I'd take the mileage of the drive as the most important factor, as companies in the US know the addresses of employees. Then I'd assume a gas price of $4.5/gallon at all times (Midwest prices aren't like the coasts) and assume a gas mileage of 25mpg. The person is paid this every day of the year without exception
Offering to finance all or part of the tickets is a good option IMO. My company offers the German "job ticket" or whatever it was called again to a percentage.
The compensation could be capped at 15 miles or 30 minutes or something, which would encourage people to live closer to work.
I would negotiate that with them because maybe Bob doesn't care but Alice does or vice versa. Now if I was either bob or Alice. Yes I'm calculating fuel, maintenance and meal cost into pay.
If it were me I'd just get an average commute, provide a stipend of gas or transport costs within your city, e.g. 15km distance, or a monthly pass for local area transit. If I'd want to relocate someone I may offer a signing bonus to help with moving and settling costs.
It's a reasonable expectation that if your job is at a workplace in Toronto, being within city limits is not an unreasonable expectation.
I like the idea of the commute being included in the work hours. When you start driving to work, that's when you're clocked in.
Alice lives closer so she can get to work faster and get more done sonce the company only loses 20 minutes of Alice-time.
Bob is farther so thats 70 minutes of Bob-time not doing work during his shift.
Maybe companies will begin to factor in the lost time of commutes and hire more locally. It could get more organized.
I am sure people's time is being wasted by inefficiency. Like, company X has several factories in the state. How many people from city A are working in the factory at city B while B's commute up to city A?
Lots to think about. Traffic, time, privacy? I dunno. Just thinking as I go :)