What Gig Employers Should Consider When It Comes to Benefits

Author: Siân Killingsworth / 26 May 2020 / Business

Since day one, our mission has been to help under-served populations of the workforce like small businesses save for their future. The gig economy is no exception. Especially during this trying time, we want to thank those contract workers who are keeping our economy moving, including food and package delivery drivers.

Historically speaking, one of the greatest perks of gig work is the flexibility, yet contract workers still lack flexible and well-rounded benefits. The discussion of portable benefits has picked up steam recently with millions of independent contractors putting their health in jeopardy to bring home a paycheck due to COVID-19.

From a retirement savings perspective, portable benefits would be an absolute game-changer.

Right now, there are some solutions that contract workers can pursue themselves, like signing up for a solo 401(k) or saving through an IRA. But with a more cohesive plan for portable retirement benefits, gig workers would have even greater accessibility to tax-advantaged accounts with higher contribution limits.

We’ve been in the benefits space for over 20 years and haven’t seen an innovation quite as thought-provoking as portable benefits. If you employ independent contractors, here are some things to keep in mind as this news develops:

Portable benefits provide transparency

Transparency is a virtue. Take a second to ask: What is it like working for me? The environment you’re creating should include a level of confidence and care for your employees. If you’re providing some type of benefits for those contract workers, let your prospective employees and customers know.

In this case, one size does fit all

If portable benefits are under serious consideration, make sure what you are providing is inclusive. Any benefits you implement, whether retirement savings or other, must be something everyone can use. Don’t offer perks for one sector of the population that won’t work for the other.

Look to the future

There will be turnover. It’s part of the gig world, and demand in certain areas will fluctuate over time. The hiring of food delivery drivers might be at an all-time high right now, but what will happen when it’s safe for everyone to eat in restaurants again? Your benefits offerings should be structured to weather these changes.

As the gig economy continues to grow, benefits offerings need to grow with it. Right now, the vast majority of gig employers are not offering retirement benefits at all, but we expect things to change with the rise of portable benefits.

At Ubiquity Retirement + Savings, we are here as your savings advocates. We’ve adapted our offerings through our 20-year history and we aren’t stopping now. We will continue to monitor for updates on portable benefits-related legislation and implementation to help you save for your future the most effective way possible.