Reprinted from Green Biz
Nearly every day since 1963, Barnes Ellis has driven 10 miles to and from his Portland, Ore., law firm alone.
But he has since traded his $250 monthly parking permit — and his high fuel costs — for a free transit pass. His law firm gave them to workers to promote alternatives to ugly commutes.
Ellis isn’t sure if he would have given up his solo commute without the nudge.
“If you think about it, 45 years is a long habit to break,” he said.
Ellis’ law firm, Stoel Rives, is one of a growing number of companies turning to employee commute programs to promote alternative transportation, boost worker quality of life and reduce carbon footprints.
Public transit, carpooling and vanpools, flextime, biking, walking and shuttles are all part of the commute program arsenal companies are offering the U.S. workforce, 76 percent of whom drive to work alone.
With workers feeling the financial pinch from high fuel prices, many believe some of the burden should fall to the boss.
In a February TransitCenter survey, 65 percent of employees said employers should take the lead in easing their commutes. Others said commute headaches could lead them to find another job.
“Employees are seriously considering changing jobs due to the high cost of commuting,” said Larry Filler, president and CEO of TransitCenter Inc., which offers pre-tax employee transit checks. “This is on top of the other difficulties employees are having, such as traffic congestion.”
Commutes of the Future
Some municipalities and states are implementing four-day work weeks to reduce worker commutes and save money by operating one fewer day. But this isn’t an option for many businesses that must service customers five or more days a week.
One popular route for many companies: telecommuting.
“It can be a real vehicle for raising employee productivity and keeping retention high at a time when … gas prices and carbon footprints are on employees’ minds,” James Brooks, Cisco’s director of human resources.
Over the last few years, Cisco tested its Virtual Office telecommuting technology on more than 12,000 employees worldwide — roughly 20 percent of staff. The results: Auto emissions fell by 30,435 tons annually and Cisco saved more than $168,000 that would have gone to buy carbon offsets.
Pre-tax commuter benefits are popular, and can even save companies money. Employees can deduct up to $115 from their paychecks each month, before taxes, to cover the cost of transit or vanpooling. This reduces payroll taxes for employers, and saves workers money. About two-thirds of the employers offering pre-tax commuter benefits extend it as a subsidized fringe benefit, Filler said. Some employers also subsidize bike purchases or retrofits, including Clif Bar, which give workers up to $500.
Companies like Google and Yahoo offer private shuttle services, while other companies are exploring vanpool services. Enterprise Rideshare, for instance, rents vans on a monthly basis in Texas, Oregon, Nevada, Georgia and California markets. The cost varies, but on average, riders typically pay between $140 and $175 per month. Interest in the services has risen dramatically over the last six months, said Manager Connie McGee.
“Our calls increased by 75 percent,” McGee said. “It’s been huge.”
The Business Case
|Key Tips for Planning an Employee Commute Program|
|Look at the transit resources in your area and form partnershipsStanford University joined local transit agencies to create special subsidized rail and transit passes for university faculty and staff.
Give people choices, not mandates Stoel Rives gave workers at its Portland, Ore., office free transit passes and its building offers free bike racks and shower facilities. It also offers zip car membership to workers who need a car during the day and carpool matching service.
Keep it simple and equitable Clif Bar rewards workers with up to $960 annually for walking, biking, carpooling, taking public transit and even riding a skateboard to work.
If you give workers incentives, make them count. Money talks but other items will get workers’ attention. Clif Bar gives employee participating in the Cool Commute program popular prizes, such as gift cards, massages or carbon offsets. “They don’t want something that’s going to end up in a landfill,” said Human Resources Manager Jen Freitas.
See also our tip sheet below on “Starting an Employee Commute Program in 10 Easy Steps”
Easier worker commutes can fatten bottom lines. An internal survey at Sun Microsystems, for example, shows that workers gave 60 percent of the time they saved commuting back to the company. In gridlocked regions throughout the country, that could add up to an extra hour each day, per telecommuter.
Reducing turnover costs also make good business sense, said Phil Winters, transportation demand management program director at the National Center for Transit Research at the University of South Florida.
The cost to hire and retrain new staff and increase productivity to the level of the worker being replaced can be up to 1.5 times the worker’s salary.
“Taking that into account, it can be a $100,000 investment, depending on the salary of people being replaced,” Winters said.
Promoting alternative transportation can save the cost providing parking, which can run thousands of dollars per space to build and maintain structures.
“What resources would you have to put forth to accommodate parkers?” asked Brodie Hamilton, Stanford University’s director of transportation and parking services. “It can cost more than $1,000 a year to pay off the loan for each space. If they take half of that and spend $500 to subsidize (employee) transportation, they would have saved some money.”
Alternative commutes, however, are not without pitfalls or challenges. Employees working from home may face distractions, lack of motivation or a yearning for social interaction, while their superiors must adjust to managing an off-site workforce. Employees could hesitate giving up their cars because of a fear of being stranded at work if an emergency arises, said Kit Powis, 511 Rideshare communications manager. Safety and weather concerns may keep workers from hopping on bikes. It’s also hard to convince someone to choose the bus or train over their car if it will take them a lot longer to reach their destination.
Employee commuting can make up a big chunk of a company’s carbon footprint. At Genetech’s South San Francisco campus, for example, employee commuting accounted for one-fifth of total emissions at that location in 2007, generating some 31,000 metric tons of carbon dioxide.