• “Money Now” Prevailing Wage Benefit
• Provides employees immediate cash during slower periods or between jobs
• Seamless administration and employee reporting

Frequently Asked Questions

Q:  What is a Supplemental Unemployment Benefit Plan (SUB Plan)?
A:  A Supplemental Unemployment Benefit (SUB) Plan is a prevailing wage fringe benefit plan used when you are contracted to a project that is subject to the Davis-Bacon Act and/or State Prevailing Wage Law.  While you are contracted to a prevailing wage job, you will make deposits to a SUB Plan account set up in your employees’ names.  This will be done in accordance with your prevailing wage policy and the applicable prevailing wage contract.  The SUB Plan then pays benefits to your employees when they have a short work period.

This plan complies with Department of Labor and Internal Revenue Service regulations.

Q:  How does this plan benefit my employees?
A:  The SUB Plan pays your employees when they need it the most, while they’re not working or working less than full time.  The Plan can pay employees when they have a short work period, which is defined as working less than 40 hours in a week or less than 173 hours in a month.

Short work periods can be caused by layoffs, bad weather, illness, lack of work, equipment down time or any number of reasons.

Q:  Where does the money for the deposits to the Plan come from?
A:  Deposits to the plan are made using dollars from the “fringe” side of the wage determination schedules used on prevailing wage jobs.  These fringe dollars are to be used to purchase bona fide benefits.

We recommend purchasing all the benefits you can with the available fringe dollars.  If there are excess fringe dollars left over, these can be deposited to the SUB Plan.  However, you are permitted to direct all fringe dollars to the SUB Plan if you are not purchasing other benefits.

Q:  How does this benefit me as the employer?
A:  If you are not directing the excess fringe dollars to the SUB Plan or other benefits, then you are likely paying these dollars to employees on their paychecks.  You are essentially paying your employees a cash bonus, which means that you are required to pay all applicable payroll taxes on these dollars.

However, by directing these excess dollars to the SUB Plan, you are not required to pay the employer’s share of these payroll taxes (i.e. 7.65% for Medicare and Social Security).  This allows you to make much more competitive bids on public works jobs as your labor costs will be lower.

Q:  How do I request benefit payments for my employees?
A:  You will submit a Benefit Qualifier Form.  This form provides the hours underworked for each employee.  When this form is received, we will process a benefit payment.

Q:  How will employees receive distributions from the plan?
A:  Employees may have distributions direct deposited into an account in their name, or have a paper check mailed to them.

Q:  What happens if there is not enough money in the account to pay for the entire short work period?
A:  We will process a payout for the full benefit amount or the balance of the employee’s account, whichever is less.

Q:  How long does it take to receive the benefit payment?
A:  We strongly encourage all employers to utilize the direct deposit option for benefit payments.  If the benefit payment is direct deposited, it will generally take 3-4 business days to post to the employee’s account.

If a paper check is requested, it will arrive about one week to 10 days from the day we receive the claim request.

Q:  How will I know that these benefit payments have been made?
A:  Every time a payout is processed, a Payout Report will be sent to you.  These Payout Reports will be sent via email, or in some cases via fax.  Use this Payout Report to verify the employee’s information as well as the amounts paid.

Q:  Do employees have to pay state and local taxes on this money?
A:  It’s possible.  Every state and locality will tax these benefits differently.  Contact a tax professional in your area for specific information.

Q:  What is a Prevailing Wage Policy Statement and how do I get one?
A:  A Prevailing Wage Policy Statement informs your employees how pay and benefits will be handled when they work on a Prevailing Wage job.  Employees may be used to receiving fringe dollars paid to them in cash.  By providing this policy statement to employees, you are avoiding and alleviating much confusion on the part of employees.

Q:  Will I receive statements and how can employees get other information about their accounts?
A:  Yes.  Near the end of every month the plan administrator will send a packet containing individual employee statements, as well as a summary statement for the employer.  Many employers distribute these individual statements to employees by including them with the next paycheck.  The summary report is for your records.