Noncompliant Employers Now Subject to Penalties Under D.C.’s Commuter Benefits Law

Andrea Murphy
Andrea Murphy

Employers covered by Washington, D.C.’s commuter benefits law now may face penalties unless they provide at least one transportation benefit program to covered employees.  The law, which was passed in 2014, went through additional rulemaking procedures with a final rule being published on August 16, 2019.  The rule became effective 90 days later on November 14, 2019.  Some of the details are as follows:

  • The law currently covers employers with 20 or more employees (except for the federal government). Employers should note, however, that it explicitly reserves the Mayor’s right to expand coverage to employers with fewer than 20 employees.
  • It covers employees who perform at least half of their working time in D.C. or whose employment is based in D.C. and who perform a substantial amount of working time in D.C. but less than half of working time elsewhere. Certain volunteers, appointed members of religious organizations, casual babysitters, and independent contractors are not
  • Employers must provide at least one “transportation benefit program” defined as:
    • A pre-tax election transportation fringe benefits program providing commuter highway vehicle, transit, or bicycling benefits equal to or greater than the maximum amount that may be deducted from the employee’s gross income under federal income tax law;
    • An employer-paid benefit program that includes the option of a transit pass for the public transit system or reimbursement of vanpool or bicycling costs equal to or greater than the price of a transit pass for an equivalent trip on a public transit system; or
    • Employer-provided transportation at no cost to the covered employee in a vanpool or bus operated by or for the employer.
  • Employers also must notify employees of:
    • The availability of the program via “commercially appropriate means,” such as email, internal documents (memos, etc.), or bulletin boards;
    • Information as to how employees may apply for and receive benefits and how to submit a complaint to the Department of Employment Services;
    • A point of contact for employees to obtain further information about the transit benefit; and
    • Commuter benefit documents made part of the employee benefits package or with the Notice of Hire form.
  • Employers must keep any documentation necessary to establish compliance with the law’s requirements for at least three years.
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