©2025 Seyfarth Shaw LLP www.seyfarth.com 2025 Cal-Peculiarities | 337 San Francisco-based employees, including those covered by collective bargaining agreements, who average 10 hours per week must be covered by a commuter benefits program.94 The waiting period for an employee to begin participating in such program cannot be longer than one month.95 Covered employers must offer a commuter benefits program regardless of whether its business is located near transit.96 Covered employers who are subject to the ordinance must submit a one-time compliance report form to the San Francisco Environment Department.97 The San Francisco Commuter Benefits Ordinance does not apply to employers with an average of 50 or more fulltime employees at all locations across the Bay Area combined. Instead, such employers are subject to the Bay Area Commuter Benefits Program described below.98 Covered employers who fail to comply with the San Francisco Commuter Benefits Ordinance requirements may be subject to administrative fines or civil penalties from the San Francisco Environment Department.99 That is, fines may be levied against covered employers after the initial written notice as follows: $100 for the first violation, $200 for the second violation and $500 for each additional violation, up to a maximum of $800.100 8.9.2 Bay Area Commuter Benefits Program Employers with an average of 50 or more full-time employees per week within the geographic boundaries of the Bay Area Air Quality Management District (the “Bay Area”) must offer commuter benefits to covered employees. Employees who perform an average of at least 20 hours of work per week within the previous calendar month within the Bay Area, excluding seasonal or temporary employees, must be covered.101 Covered employers must offer at least one of the following benefits: Pre-tax benefit: A program, consistent with section 132(f) of the Internal Revenue Code, allowing covered employees to elect to exclude from taxable wages costs incurred for transit passes or vanpool charges, up to the maximum amount allowed by federal tax law (up to $325 per month for 2025); Employer-paid benefit: A subsidy to offset the monthly cost of commuting via transit or by vanpool. The subsidy must be either the monthly cost of commuting via transit or vanpool or $75 (adjusted annually consistent with the California Consumer Price Index for San Francisco-Oakland-San Jose), whichever is lower. An optional subsidy for bicycle commuting costs may also be provided in addition to subsidies for transit and vanpool costs; Employer-provided transit: A free employer-provided vanpool, bus, or similar multi-passenger vehicle; Alternative commuter benefit: An alternative commuter benefit program that provides at least the same reduction in single-occupant vehicle trips as any one of the three options above. An alternative commuter benefit program must be proposed in writing, complying with the guidelines issued by Air Pollution Control Officer (APCO), and approved in writing by the APCO; or Telework: A company-wide policy allowing telework for one or more days per week for all employees whose assignments can be performed remotely.102 Furthermore, covered employers must designate a Commuter Benefits Coordinator who is responsible for implementing the commuter benefits program and complying with the Bay Area Commuter Benefits Program requirements. After initial registration with the Bay Area Air Quality Management District, covered employers must update and verify their registration information on an annual basis.103 Covered employers must also provide an annual notice of the commuter benefits program to all covered employees. The notice must include information on the type of commuter benefits offered, how the covered
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