My employees refer to prevailing wage fringe as “their money”

My employees refer to prevailing wage fringe as “their money”. What can the Company do if the employee does not sign up for the 401(k) and does not have health insurance through the company?

These are common questions.

Prevailing Wage Required Fringe

Employees may refer to the prevailing wage required fringe as their money. The prevailing wage fringe is a specific dollar value of bona fide fringes the Company must furnish an employee; it is not an employee option to choose the fringe be paid as Cash in Lieu of Fringe (wages). The Company has the option to choose the fringe benefits offered, as long as they meet the definition of “bona fide” as defined by regulations.

Health Insurance and 401(k)

In addition, an employee does not sign up for a 401(k) Retirement Savings Plan Company contribution; the decision to make that type of contribution is made by the Employer. The DOL Field Operations Handbook, states (1) “If an employee desires cash payments or benefits other than those chosen by the contractor, that would be a matter for discussion and resolution between the employee and the employer.” and (2) “The contractor is under no obligation to obtain the employee’s concurrence before contributing to the fringe benefit plan on his or her behalf.”