WASHINGTON, April 16, 2024 – The ERISA Industry Committee (ERIC) today praised the Biden Administration as well as the Department of the Treasury and Internal Revenue Service for clarifying that employer-sponsored work-life referral and support services may be provided to working families tax-free.
“ERIC and our member companies, large employers across the nation and representing every industry, strongly support today’s guidance, which protects family caregivers, enhances the ability of employers to support their workers during challenging times, and allows employees to remain in the workforce to support their families,” said James Gelfand, President and CEO of ERIC. “ERIC worked closely with the Biden Administration and with our partners to ensure that this clarification would provide relief to working families, enhance the viability and desirability of caregiving benefits, and ultimately expand the number of Americans who have access to caregiving navigational and work-life referral and support benefits.”
The new guidance concerns benefits provided by employers to help workers identify, assess, and solve common personal, work, and family challenges that, if left unaddressed, could interfere with an employee’s ability to stay in the workforce. Employers frequently use third-party service providers that employ subject-matter specialists who are trained in guiding employees through issues concerning their eligibility for employer or community benefits. These benefits can offer navigational and logistical support to employees during a host of challenges.
According to the IRS guidance, work-life referral and support services offer employees guidance, support, information, and referrals in connection with, for example:
- Identifying appropriate education, care, and medical service providers
- Choosing a child or dependent care program
- Navigating eligibility for government benefits, including veterans administration benefits
- Evaluating and using paid leave programs offered through employer, or a state, or locality
- Locating home services professionals who specialize in adapting a home for a family member with special care needs
- Navigating the medical system, including private insurance and public programs, and utilizing available medical travel benefits
- Connecting the employee with local retirement and financial planning professionals
The benefits are focused on navigation and logistical support; they do not cover the costs of the underlying services such as daycare, medical care, or school tuition. However, the support enables employees to drastically reduce the stress of caring for a loved one, enhancing their ability to balance the demands of work with family responsibilities.
“Many ERIC member companies currently offer these benefits to employees, providing support and assistance during challenging life events,” said Gelfand. “We hope that this tax clarification will provide the certainty needed for many more employers to offer caregiving support to employees and will help ensure the benefits are used by those most in need. We thank the Biden Administration for addressing this critical need and scoring a victory for employers and especially for working families.”