With savings from tax bill, employers say they'll boost wages, 401k contributions
- In the week since the passage of a major Congressional tax overhaul, multiple organizations have made public their intent to reinvest tax savings in their respective workforces in the past week.
- Aflac says it will use its savings to, among other things, expand employee benefits and training programs. The insurer plans to raise its 401k match from 50% to 100% on the first 4% of each employee's contribution with an additional, one-time $500 payment into each account. Similarly, Suntrust Banks, Inc. will add a 1% contribution to all employees' 401k accounts as well as a $1,000 incentive for workers to compete its in-house "financial fitness" program.
- Comerica, a Dallas-based financial services firm, said it would raise its minimum wage to $15/hr and give each non-executive employee a one-time, $1,000 bonus this year.
These are just a few examples of businesses that quickly jumped on the good news of a favorable tax overhaul as an opportunity to give back to workers, be it through minimum-wage increases, bonuses or other means. Many also plan to up their philanthropic allocations.
The tax law left retirement fund contribution levels alone; the limit for employers is set to rise in 2018 courtesy of the IRS. Employee-invested companies have taken the opportunity to increase 401k contributions, and others, like Boeing, are investing in the future and U.S. economy by diverting tax savings into future technologies.
Republican lawmakers hailed the tax-reform legislation as a win for the American middle class. Democrats and other opponents of the bill call it a windfall for large corporations and top-tier billionaires at the expense of working-class Americans. HR should read between the lines, as the bill will likely have unforeseen consequences — both positive and negative.
Employers who choose to share their good fortune from the new tax law with their workers, communities and through their philanthropic interests are well positioned to attract and retain talent and enhance their brand with consumers and other stakeholders.
- PR Newswire Aflac Incorporated Responds to Tax Reform with Plan for Additional Investments in the U.S. of $250 million Targeting Workforce, Strategic Allocations for Business Growth, and Renewed and Strengthened Commitment to Childhood Cancer
- PR Newswire Comerica Announces Increase In Its Minimum Wage To $15 Per Hour And $1,000 Bonus To 4,500 Non-Officer Colleagues
- PR Newswire SunTrust to Increase Minimum Wage, Build Teammate Savings and Create $50 Million Community Fund for Financial Well-Being
- HR Dive Final tax reform bill includes leave, benefits changes