HR Headaches: How to Assist Employees Who Need Help Due to Gas Price Increases

As gas prices rise, American workers are being hit in the budget — hard. For low- to middle-income wage earners an increase at the pump pits getting to work against paying for other necessities.  Some workers can make a switch to public transportation to get to work, but for many, that’s not an option.

Business leaders are looking to help staffers, but with no end in sight for rising prices they may have to get creative. There are low- to no-cost ways you can help employees get to work with a smaller impact on their budget. Some will create additional taxable income for the staff member, others may open the door to building connections and relationships within the firm. All will require a bit of planning and anticipating where the market will shift, and when.

Pain at the pump

No matter where they’re fueling up, workers are seeing a 50 to 100% increase in their cost to commute, and prices continue to rise.

In February 2022, the average price for a gallon of gas was $2.24 in the United States — the lowest since 2016 and second  lowest since 2004. Today’s national average is almost double at $4.09 per gallon. According to AAA prices vary by state, with a low of $3.65 in Missouri up to $5.74 in California.  No matter where they’re fueling up, workers are seeing a 50 to 100% increase in their cost to commute, and prices continue to rise.

The annual summertime gas price rise will only add to the problem. Historically, after Memorial Day, the price of fuel rises due to increased demand for the summer driving and traveling season. To keep costs down, the Biden Administration announced it directed the Environmental Protection Agency to issue an emergency waiver that allows widespread sale of 15% ethanol blend for the summer. This fuel is typically prohibited  June 1 through Sept. 15 because of concerns that it increases smog in summer months. For 2022, those concerns will be tabled to help American workers and travelers.

Sticker shock solutions

There are several ways businesses can help staff weather the rising gas price storm. They include cash payments, education, and looking for solutions that spread the cost more widely. Here are some to consider.

Paying the price

For some companies, a temporary bump in salary or an additional gas allowance per week can ease the burden. The challenge may be to dole these perks out fairly. For employees who typically commute by public transportation, there might be no benefit. For those who commute from nearby locations, the bump might be appreciated but barely needed. Those who commute from a long distance may see the bump only make a dent in their rising cost to get to work. Talk to staff members to determine an amount that would help, then determine whether it’s affordable for the business.

If you plan to offer a cash benefit or a temporary increase, a best practice would be to offer it to all staff members. Disabled workers, for example, may not drive or own a car: not offering a benefit based, even indirectly, on their disability may be considered disparate treatment.

Remember that any cash or cash — equivalent (like pre-paid gas credit cards) are considered taxable income. The IRS considers gift cards have an ascertainable value and they’ll need to be reported, just as an additional gas allowance, as supplemental income on your workers’ W-2 form.

Cut out the commute

If you’re already allowing remote or hybrid work it might be worthwhile to scuttle plans to return onsite until prices come down. If you haven’t considered or aren’t offering remote work, it might be worth investigating. With gas prices doubled in some areas, allowing staff to work from home half the time could offset the additional cost.

Some experts believe continuing with wide scale remote work could help keep gas prices down. If demand doesn’t rise during the summer months due to remote workers, prices may normalize, they suggest. A bonus – employees love working remotely and businesses see reduced operating costs when they do.

Drive smarter

There are many resources available that help everyone drive smarter and more efficiently. If your workers can’t afford to trade in their gas guzzler for an EV, you can provide them with information on how to get the most mileage from whatever car they drive. Here are some tips from the federal government you can pass on to staff:

Get zen behind the wheel

A lead foot means a lot of fuel. Driving less aggressively, not speeding, and not accelerating rapidly (it’s not a race when the light turns green), can lower fuel costs. Aggressive driving can lower gas mileage 15 to 30% on the highway: 10 to 40% in stop-and-go traffic. Bonus – you’ll be safer on the road.

Lose some (car) weight

Hauling cargo containers on the roof of any vehicle changes its aerodynamics and impacts miles per gallon. That rooftop cargo box lowers mpg 2 to 8% in city driving, up to 25% on highways or interstates. Rear cargo boxes don’t have as much impact, but they can lower fuel efficiency 1 to 5% in city and highway driving. If you’re not using them, remove them to save on gas.

If the back seat or trunk is full, take time to clear that, as well. Every 100 pounds of weight in the vehicle reduces mpg by about 1% — the smaller the vehicle the more it’s affected. If you’re not using that gear, leave it at home when you commute.

Cut out idle time

Idling is a gas waster, too. When stuck at particularly long stoplights, consider turning off the engine to save a bit of fuel. Some newer model cars offer this feature automatically. After a few seconds the car shuts down – when the driver takes their foot off the brake it starts again. Getting into the habit of using the feature, or shutting down manually while you wait, can stretch gas mileage.

Check for inflation

Tire inflation, that is. Making sure your tires are inflated to the manufacturer’s suggested pressure can improve mileage up to 3%. Under-inflated tires are estimated to lower miles per gallon by about 0.2% for every 1 psi drop. When tires are properly inflated, they’re also safer and last longer.

Tune it up

When cars are not in tune or if they fail an emissions test they can reduce gas mileage up to 4%. For some issues, like replacing a faulty oxygen sensor, mileage can be improved by 40%. Using the manufacturer’s recommended motor oil can also help: the wrong grade of oil can lower gas mileage by 1 to 2%.

Feel the heat

As the temperatures rise, so does the use of air conditioning in the car. A/C can reduce a vehicle’s fuel efficiency up to 25%, particularly on short trips. For hybrids, plug-in hybrids, and EVs the reduction in mpg can be even larger on a percentage basis.

Unfortunately, riding with the windows down also reduces mpg, especially on the highway,  but to a lesser extent. Start with open windows to let the heat out of the car before you crank up the A/C; resist the urge to turn the inside of the car into walk-in-freezer temps; and turn it off periodically to save on gas.

Perks for leaving the car at home

Businesses can offer perks for workers who opt out of driving with alternative methods of getting to work. Commuter benefits provide incentives to staff members who use public transportation. They can subsidize all or part of an employee’s cost to get to work.

The Bike Commuter Tax benefit allows businesses to reimburse employees monthly if they take their bike to work. This incentive, particularly in warmer months, not only reduces fuel costs — it helps workers get in shape. Some companies offer indoor or secure bike parking to further encourage riding to work on a bike or motorized bike. Whenever you post for a new position, include your commuter perks in the ad – they may open you to a wider range of applicants.

The Bike Commuter Tax benefit allows businesses to reimburse employees monthly if they take their bike to work. This incentive, particularly in warmer months, not only reduces fuel costs — it helps workers get in shape.

Pool resources

Carpooling could be a solution that not only helps employees reduce their cost to commute, it could create relationships that would not have occurred within the workplace. Consider developing a voluntary car pool program that allows workers to opt — in to either join another employee’s commute or offer themselves as the driver. Employees can share the cost of gas, cutting their out-of-pocket expenses by half or more if multiple workers share the ride.

Staff members may need someone to help with logistics: one person who can look at who’s interested in participating and if they’re on-route or near enough to others that a pit stop is worthwhile. It may take a bit of coordination, but in the end it could mean significant savings on gas for workers. It can also help employees meet colleagues they might never have interacted with before. Post the potential carpool option when you look to fill a vacancy — it may be the incentive a job seeker needs to apply.

Shuttle services

If your company is close — but not close enough — to public transportation, consider a shuttle service. One of your own larger vehicles makes the repeated rounds from the company to the nearest bus or train stop at the beginning and end of shifts. Shuttles can help employees who are close to public transportation at home, but not work, eliminate the need to drive entirely.

Consider piloting a shuttle program during these difficult times — you may want to continue it indefinitely to open your organization to ease the commute for existing staff. Shuttling may even open your organization to a wider applicant pool for new hires. Make sure  you promote the service widely for existing and potential staff.

There isn’t a lot an organization can do to help reduce the price at the pump, but business leaders can help workers reduce the cost to commute. Educating staff; helping with costs or starting a shuttle or carpool group in your company can do more than save money: they help your organization attract more talent and reduce its carbon footprint.