The SUB Plan
For Employers
Lower Costs. Better Bids. Stronger Teams.
The PSG SUB Plan turns your prevailing wage fringe obligation into a competitive advantage — cutting payroll taxes, satisfying compliance requirements, and keeping your best workers on the payroll.
7.65%
FICA Saved on Fringe Dollars
$0
Employer Setup Fee
26 Weeks
Max Benefit Duration Per Worker
100%
Davis-Bacon Compliant
Why Employers Choose PSG
A Benefit Your Workers Will Actually Value
Most fringe benefits feel abstract to workers — a number on a pay stub they don't fully understand. The SUB Plan is different. When a worker gets a direct deposit during a two-week layoff, they remember who made that possible.
That loyalty translates directly into lower turnover, faster rehires when the next job starts, and a reputation as an employer worth working for.
Why Employers Choose the SUB Plan
Six Reasons to Enroll
Eliminate Payroll Taxes on Fringe
Fringe dollars deposited into the SUB Plan trust are not subject to FICA, FUTA, or state unemployment taxes — saving employers a meaningful percentage on every fringe dollar contributed.
Win More Public Work
Lower effective labor costs mean more competitive bids on prevailing wage projects. Contractors using a SUB Plan routinely sharpen their numbers without cutting margins.
Satisfy Prevailing Wage Requirements
SUB Plan contributions count as bona fide fringe benefits under the Davis-Bacon Act and most state prevailing wage laws — dollar-for-dollar against your fringe obligation.
Retain Your Best Workers
Workers who receive income support during layoffs are far more likely to return when the next job starts — reducing costly turnover, rehiring, and retraining.
Simplified Administration
PSG manages plan setup, trust documentation, contribution tracking, and employee disbursements. Your payroll team submits contributions — we handle the rest.
Works With Your Existing Benefits
The SUB Plan pairs with health insurance, retirement plans, and vacation trusts. Use it as a catch-all for remaining fringe dollars after other benefit contributions are made.
The Process
How It Works for Employers
01
Enroll With PSG
PSG handles all plan documentation, IRS filings, and trust setup. You'll receive a simple adoption agreement and onboarding materials for your payroll team.
02
Submit Fringe Contributions
For each prevailing wage or public works hour worked, you deposit the applicable fringe rate into the SUB Plan trust. Contributions are credited to individual employee accounts.
03
Workers Access Benefits When Needed
When an employee experiences an involuntary layoff, weather delay, or short work week (under 36 hours), they submit a benefit request. PSG reviews and approves disbursements.
04
Benefits Paid Directly to Employees
Approved benefit payments are sent directly to the employee via direct deposit or check — typically within days of the request. You receive confirmation and records for your files.
Flexible by Design
The SUB Plan as a Catch-All
Unlike a 401(k) or health plan, the SUB Plan has no contribution minimums and no complex enrollment windows. It's designed to absorb whatever fringe dollars remain after your other benefit contributions are made.
If high fringe rates push you toward retirement plan contribution limits, the SUB Plan provides an additional compliant destination for those dollars. If you want to give employees a choice in how their fringe is allocated, the SUB Plan is consistently the most popular option — because workers can access it immediately.
PSG will help you design a fringe benefit package that maximizes your tax savings, satisfies prevailing wage requirements, and gives your workforce real, tangible value.
Example Fringe Package
Every dollar above is removed from taxable payroll — saving the employer FICA, FUTA, and potentially workers' comp and general liability premiums on the full fringe amount.
FAQs
Employer Questions
See How Much Your Company Could Save
Schedule a free consultation with PSG. We'll review your current fringe setup and show you exactly what a SUB Plan would save on your next prevailing wage project.