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The SUB Plan
A Supplemental Unemployment Benefits Plan that turns fringe dollars into real income protection for your workers — while cutting your payroll tax burden and satisfying prevailing wage requirements.
What Is It?
Income Protection Built Into Your Fringe Package
Seasonal layoffs and short work periods are a fact of life in the construction industry. The PSG Supplemental Unemployment Benefits (SUB) Plan uses fringe benefit dollars to provide income replacement for employees who face these involuntary work stoppages.
Employers deposit fringe dollars on behalf of employees who work on prevailing wage or public works jobs. Those dollars are credited to individual employee accounts in the SUB Plan trust. When a worker experiences an involuntary layoff, weather delay, or short work week, the plan pays cash benefits directly to the employee — via direct deposit or check.
For employers, every dollar contributed counts as a bona fide fringe benefit under the Davis-Bacon Act and most state prevailing wage laws — reducing your cash wage obligation and eliminating payroll taxes on those fringe dollars.
Qualifies as a bona fide fringe benefit
Accepted under Davis-Bacon and most state prevailing wage laws.
No payroll taxes on contributions
Fringe dollars deposited into the trust are not subject to FICA or FUTA.
Workers receive benefits quickly
Payments go directly to employees — no waiting until retirement.
Accounts are portable
Employee balances follow the worker, even if they change employers.
Why It Works
The SUB Plan Advantage
Reduces Cash Wage Obligation
Every dollar contributed to the SUB Plan counts as a bona fide fringe benefit — reducing your prevailing wage cash obligation dollar-for-dollar.
Eliminates Payroll Tax on Fringe
By moving fringe dollars off payroll and into the trust, employers avoid FICA, FUTA, and state unemployment taxes on those contributions.
Retains Skilled Workers
Workers who know their income is protected during layoffs are far more likely to return when the next job starts — reducing your rehiring and retraining costs.
Works Alongside Other Benefits
The SUB Plan pairs seamlessly with health insurance, retirement plans, and vacation trusts — acting as a catch-all for remaining fringe dollars.
Learn More
Find the Information That's Right for You
For Employers
Learn how the SUB Plan reduces your prevailing wage cash obligation, eliminates payroll taxes on fringe dollars, and helps you win more public work — without adding complexity to your payroll.
- Payroll tax savings
- Prevailing wage compliance
- Competitive bidding advantage
- Simple plan administration
For Employees
Understand how your SUB Plan account works, when you can access your benefits, how much you can receive, and what happens to your funds if you change jobs.
- Income during layoffs & weather delays
- Paid via direct deposit or check
- Stacks with state unemployment
- Funds stay with you if you change jobs
Ready to Add a SUB Plan?
PSG handles everything — plan setup, trust administration, contribution tracking, and employee disbursements. Schedule a free consultation to see how it works for your company.