A Quick Guide to Beneco’s Products & Services
For contractors who perform jobs pursuant to the Davis-Bacon Act, many don’t know the advantages it can afford them. At Beneco, we offer product and services that can help our clients be more profitable, bid jobs more competitively and offer premium benefits to their employees.
The Davis-Bacon Act (DBA) stipulates when contractors perform public jobs, they must pay their employees “prevailing wage” compensation for the geographic area in which the work is done. The “prevailing wage” rate includes a base wage and a fringe benefit amount, both of which are subject to various payroll taxes and labor burden. The DBA allows contractors to pay the fringe benefit amount to a “bona fide” trust on behalf of their employees, which can lessen a contractors’ tax liability. Since the fringe benefit is not paid as cash compensation, it is no longer subject to payroll taxes or labor burden. This can potentially save a contractor, on average, 8-10% on labor costs.
Once the fringe benefit is contributed to the trust, it can be used many different ways. Beneco offers many premium benefit programs that are approved under the DBA. First is the Beneco pension product, which is a qualified retirement plan trust where fringe dollars are contributed on a pre-tax basis, similar to a traditional 401(k) plan. Assets grow tax-deferred and the plan is subject to all Internal Revenue Service (IRS) and Employee Retirement Income Security Act (ERISA) regulations. We offer investment products from many financial institutions, such as JPMorgan, Fidelity and T. Rowe Price.
In addition to the pension product, we also offer Health & Welfare products including major medical, short-term and long-term disability and the Smart Return Account (SRA) which is similar to a Health Savings Account (HSA). We partner with companies like Aetna, Blue Cross/BlueShield and Unum to help provide contractors with these benefits. We also offer other benefit programs such as a Vacation & Holiday plan and apprenticeship training.
In addition to saving payroll taxes and labor burden, our clients have the advantage of choosing exactly what they need for their business and their employees. We create customized benefit solutions that are tailored specifically for our clients and their businesses.
With over 25 years of experience, Beneco is an industry leader in the fringe benefit space. We have helped contractors provide premium benefits to their employees while saving, on average, 8-10% on total labor costs. Not only do we help our clients become more profitable, we form partnerships to help grow their business.
If you’re interested in finding out more, contact us today! We want to partner with you and help your business to be Always Building!