The C O N T R A C T O R S P L A N

Group Benefi ts

Contractors who work on government jobs face complex regulations and tight scrutiny for compliance. Work with a partner that specializes in providing benefi ts for government contractors and has experience with the laws that apply to them.

We can help you:

• Cut Job Costs – See immediate savings on payroll burden.

• Submit More Competitive Bids – Reduce payroll costs and pass the savings along.

• Provide Quality Benefi ts for Employees – Offer medical, dental, vision, disability, life insurance and retirement plans.

• Simplify Recordkeeping and Administration – We track benefi ts by the hour, which signifi cantly reduces chances of overpaying premium.

• Extend Medical Coverage During Slow Times and Layoffs – Our unique hour banking program means you pay only for hours worked.

• Stay in Compliance with DOL, IRS, the Affordable Care Act and State Regulations – Count on our years of experience working with state and federal agencies.

• Respond Quickly and Accurately in the Event of an Audit – We partner with you to prepare your responses to inquiries and audits.

TABLE OF CONTENTSThe Contractors Plan Is Your Partner for Group Benefi ts . . . .2

Payroll Cost Comparison . . . . .3

Cost Savings Worksheet . . . . .4

Sample Bidder's List . . . . . . . .5

Hour Banking . . . . . . . . . . . .6

Medical Benefi ts. . . . . . . . . .7

Specialty Benefi ts . . . . . . . . .8

Retirement Solutions . . . . . . .9

Total Fringe. . . . . . . . . . . . 10

The Contractors Plan Benefi ts Portal . . . . . . . . . . 11

Compliance & Audit Support . 12

Medical Plan Services & Fees . 13

Sample Implementation Timeline . . . . . . . . . . . . . 14

THE CONTRACTORS PLAN IS YOUR PARTNER FOR GROUP BENEFITS

Why Choose The Contractors Plan?The Contractors Plan is one of few companies in the U.S. that specializes in benefi ts plans for prevailing wage contractors. We were the fi rst company to offer bona fi de benefi ts plans, and we’ve been doing this for 30 years. We specialize in bona fi de benefi ts plans for Davis-Bacon and Service Contract Act contractors. Since we understand your specifi c needs, set up and administration of your benefi ts plans is seamless and hassle-free.

T H E C O N T R A C T O R S P L A N ® Group Benefi ts | 3

WITH THE CONTRACTORS PLAN, YOU COULD SEE SAVINGS OF $2.50 PER EMPLOYEE PER HOUR OR OVER 5% OF PAYROLL! WIN YOUR NEXT BID… OR INCREASE PROFITS.

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Payroll Cost Comparison of Fringes Paid in Cash vs. The Contractors PlanPayroll Cost Comparison of Fringes Paid in Cash vs. The Contractors Plan

Paying the Fringe as Additional Cash Wages Using The Contractors PlanUsing The Contractors PlanBase Wage $30.00 Base Wage $30.00

Fringe Amount Paid as CashFringe Amount Paid as Cash $10.00 Fringe Amount Paid as Cash n/a

Total Hourly Cash Wage $40.00$40.00 Total Hourly Cash Wage $30.00

Payroll Tax Burden Percentage* 25% Payroll Tax Burden Percentage* 25%

Hourly Payroll Tax Burden $10.00 Hourly Payroll Tax Burden $7.50

Cash Hourly WageCash Hourly Wage $40.00 Fringe Amount Paid Into Plan $10.00

Total Bid Hourly Cost $50.00 Total Bid Hourly CostTotal Bid Hourly Cost $47.50

*FICA: 7.65%; FUTA: 0.80%; SUTA: 1.4%, varies widely from state to state; workers’ comp: approx. 20%, varies by state.

25 employees x 1,000 hours

= 25,000 Hours= 25,000 Hours

25,000 hours x $10.00

= $250,000 Additional Payroll

$250,000 x 25%

= $62,500 in Company Savings

LONG-TERM SAVINGS

100% of work PW

50% of work PW

Savings over 5 years $625,000 $312,500

Savings over 10 years $1,250,000 $625,000

Payroll Data Requirements for Calculation (fi ll in the blanks below)

FICA 7.65%

FUTA 0.80%

SUTA

Workers' Compensation

General Liability

Number of Employees

Approximate Hours Worked

Fringe Amount per Hour

Total Payroll Burden %

Payroll Cost Savings (fi ll in the blanks below)

employees x hours = Total Hours

hours x fringe rate = Additional Payroll

additional payroll x total payroll burden % = SAVINGS

Total Bottom-line Impact (fi ll in the blanks below)

Profi t-sharing Savings $

Deferred Tax Savings $

PLUS Payroll Cost Savings $

Total Impact $

/ C O S T S A V I N G S W O R K S H E E T /

T H E C O N T R A C T O R S P L A N ® Group Benefi ts | 5

FAIRCHILD HALL REHABILITATION PROJECT Estimated amount: $3,600,000Bids opened: Friday, January 8, 2013

{ I L L U S T R AT I O N 2 - B I D D I N G F O R T H E FA I R C H I L D H A L L R E H A B I L I TAT I O N P R O J E C T }While the names of the companies have been changed, the bid amounts were taken from an actual bid opening.

1. Scotts Industrial Electric 3178 Bincrete Lane (999) 298-7481 $674,595.00

2. Heatherville Electric 360 Industrial Drive (999) 743-1220 $675,900.00

3. Johnson Electric 1145 Bellbrook Ave. (999) 372-8205 $681,000.00

4. Chappelle Electric 1985 Founders (999) 222-2290 $732,442.00

5. Caret Electric Company 3925 Pansini Lane (999) 669-3399 $735,000.00

6. Kastle Electric 4501 Libby Blvd. (999) 254-2681 $740,300.00

7. BBW Electrical Contractors 3400 Kettering Blvd. (999) 293-6138 $745,897.00

8. Debra/Kuempel 1948 W. Phyllis Lane (999) 531-5455 $770,000.00

9. Schamberger Electric 6901 Americana Pkwy. (999) 863-1844 $788,500.00

10. Mutual Electric 3660 Dayton Park Drive (999) 254-6211 $809,000.00

11. Welling Brothers 105 Billips Drive (999) 394-7559 $913,000.00

12. Mulligan Electric 8459 N. Main St. (999) 890-9510 $1,140,000.00

The company that came in second on this bid lost the job by only $1,305. The savings realized by contributing the benefi t portion of the prevailing wage to a bona fi de plan could have made up that difference many times over and resulted in a winning bid and reaping additional profi ts.

/ S A M P L E B I D D E R S L I S T /

Hour banking helps contractors to avoid overpaying premiums and affords employees a way to extend medical coverage during work stoppages.

How Hour Banking WorksContractors pay only for hours worked. That eliminates time spent trying to get premium refunded from insurance carriers. Hour banking is a practical solution for companies that experience rapid increases or decreases in employee numbers:

• Employees accumulate premium credits for excess hours worked

• The possibility of ineligibility under traditional programs is eliminated

• Employees are protected during layoffs

• Employees may bank up to 5 months of benefi ts

• Employers pay for actual hours worked, preventing overpayment of premium

• Allows precise per hour cost in bid preparation

With hour banking, accounting for hours worked and their corresponding fringes is seamless and transparent.

Transitioning to Hour BankingEmployers should be aware that there is a 60-day lag between the hours worked and provision of benefi ts. Refer to the hour banking example below.

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Month Worked

Month Benefi t

Provided

Hours Worked

Hourly Rate

Premium Submit

Hours of Credit

Required

Depleted from

Hour Bank

Hour Bank Account

Aug. Oct. 160 $1.00 $160 -130 0 30

Sept. Nov. 180 $1.00 $180 -130 0 80

Oct. Dec. 100 $1.00 $100 -130 30 50

/ H O U R B A N K I N G /

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THE CONTRACTORS PLAN IS PROUD TO WORK WITH THESE FULLY-INSURED CARRIER PARTNERS:

The ProblemPrevailing Wage contractors need medical coverage that is fl exible enough to accommodate the unique challenges they face:

• Multiple job sites in several states

• Rapid employee turnover

• Multiple employee classes

• Seasonality

• Job interruptions

• Complex administrative and compliance burdens

Benefi ts providers who are unfamiliar with prevailing wage requirements can overlook these issues, causing contractors unnecessary expense and compliance issues.

The SolutionThe Contractors Plan provided by Fringe Benefi t Group designs solutions specifi cally for prevailing wage contractors, and we are the single point of contact for any issues that may arise. This means you don’t have to handle billing, administration, eligibility, or COBRA administration.

Tracking hours and premium is also simplifi ed with our industry-unique Hour Banking program. You pay premium only for hours worked, and employees can “bank” hours worked during busy times, then draw from that bank during slower times to maintain medical coverage.

The Contractors Plan AdvantageOur size gives us leverage with our carrier partners, so we can offer your company the benefi t of being part of a larger group of contractors. This minimizes risk and liability, particularly for smaller contractors.

The underwriting process is simplifi ed because your company becomes part of a large risk pool. This also helps during the renewal process and reduces cash fl ow risk in future years. When you’re part of a larger pool, the possibility that a sizable claim will drastically increase your rates is lessened, helping to avoid extreme volatilities in cost.

We can cover specifi c job sites or job classes only. We specialize in benefi t plans for prevailing wage contractors, so we’re accustomed to handling unique situations.

/ M E D I C A L B E N E F I T S /

When your employees and their families are protected from unexpected expenses, they can focus on their jobs. The challenge has been offering these benefi ts in a way that qualifi es as a “bona fi de” fringe benefi t, and that isn’t complicated and time-consuming for employers to administer.

The Contractors Plan offers options that maximize company tax savings while providing quality benefi ts for hourly workers.

We break down the benefi ts you select into an hourly equivalent cost so you can pay one hourly rate for the collective benefi ts chosen. Using more of the fringe to provide bona fi de benefi ts reduces your payroll tax burden.

/ S P E C I A LT Y B E N E F I T S /

Founded in 1887, Ameritas Group is an “A” rated, national insurance carrier specializing in dental and vision benefi t plans. As an industry leader, Ameritas has one of the largest PPO networks in the country with over 235,000 dental access points. Ameritas vision options include a unique FUSION plan – dental and eye care benefi ts combined on one policy. Ameritas provides products and services for nearly 100,000 employer groups, insuring or administering benefi ts for more than 5.4 million people nationwide.

During the last 45 years MetLife has built one of the largest and best-credentialed networks in the nation with over 148,000 participating dentist locations, including 22,000 specialists. Members save, on average, 15 – 45% when they choose a network dentist rather than non-network providers. MetLife is the largest commercial dental plan administrator with the U.S. military (TriCare) and 43 of the Fortune 100® companies and as customers serving 21 million dental members.

Transamerica products offered by The Contractors Plan have been specifi cally designed to comply with the needs of prevailing wage contractors and are Guaranteed Issue (without medical underwriting). Contractors save money and ensure that their employees are protected from unexpected accidents and illnesses. We maintain eligibility and provide all necessary recordkeeping ensuring accurate claims adjudication and compliance when responding to government inquiries or audits.

• Dental Insurance

• Disability Income Protection

• Vision Insurance

• Group Term Life Insurance/AD&D

• Critical Illness

• Employee Assistance Program (EAP)

• Gap Insurance

IN ADDITION TO MEDICAL COVERAGE AND RETIREMENT PLANS, WE ALSO OFFER:

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Why offer a retirement plan for your hourly workers?Health insurance and specialty benefi ts often don’t exhaust the entire fringe portion of the prevailing wage. Funneling remaining fringe dollars to a retirement plan helps your workers to secure a more comfortable future while maximizing your savings on payroll burden.

We analyze your company’s specifi c situation and design a retirement plan that helps you cut costs, reduce both corporate and personal tax liability, and save for retirement.

For example, prevailing wage dollars can be used to:

• Increase the amount owners and HCEs can defer for retirement

• Offset profi t sharing costs

• Offset Safe Harbor contributions

/ R E T I R E M E N T S O L U T I O N S /

ALREADY HAVE A 401(k) PLAN?

We can set up a plan specifi cally for prevailing wage contributions, and then test the plans together at year-end for compliance. Retirement plan options include:

Basic Prevailing Wage Retirement Plan – we analyze your Schedule A at year end and advise you regarding contributions owner and HCE retirement plans.

• 401(k) Plan – Traditional and Roth

• Profi t Sharing – including New Comparability

/ T O T A L F R I N G E /

Total Fringe is a seamless, hassle-free solution that maximizes payroll savings and streamlines benefi t plan administration.

With Total Fringe, contractors choose from our comprehensive menu of bona fi de benefi ts to allocate the entire fringe portion of the prevailing wage. Regardless how many or what types of benefi ts offered, you upload one fi le and send in one check.

The Contractors Plan handles administration of all benefi ts and payment of carriers – freeing you to concentrate on your business.

Benefi ts you can offer include:

• Major Medical • Dental Insurance • Disability Income Protection• Vision Insurance • Group Term Life

Insurance/AD&D

• Critical Illness • Employee Assistance

Program (EAP)• Gap Insurance • Retirement Plans

The coverages you select are broken down into an hourly premium, so you pay one hourly rate for all collective benefi ts. We provide administration, and can do so by the job and by the hour.

With Total Fringe employees who already have coverage can invest their fringe dollars in coverages which are most benefi cial for themselves and their families. Contractors reap maximum savings on payroll costs, freedom from spending time on benefi ts administration, and the fl exibility and simplicity that come from having a single-source benefi ts solution.

Total Fringe helps contractors avoid cost overruns on benefi ts, which means increased profi ts over the life of the contract.

Contractors who use Total Fringe are also better equipped to forecast future benefi t liabilities and make adjustments to protect themselves from the increasing costs of health care benefi ts. All benefi ts can be enrolled and administered online at MyContractorsPlan.com.

YOUR FRINGE REQUIREMENT

Dental $0.40

Medical$3.00

HRA$1.40

Vision$0.10

Retirement$10.00

Life Insurance$0.10

Total Fringe$15.00

OR

Medical Single $2.00 Medical Family $4.00

Vacation $1.00 Vacation $1.00

Apprentice $0.25 Apprentice $0.25

Retirement $11.75 Retirement $9.75

Fringe Rate $15.00 Fringe Rate $15.00

TOTAL FRINGE HOURLY BREAKDOWN:

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/ T H E C O N T R A C T O R S P L A N B E N E F I T S P O R TA L /

Comprehensive Benefi ts Enrollment and Account ManagementIf you have employees spread across several job sites, or working different shifts, you already know the logistics of enrolling employees in a benefi t plan can be a headache.

Not with the Contractors Plan. We design a customized online benefi ts enrollment and management platform for each of our clients. That means your employees can enroll in the benefi ts plan anytime, anywhere they have online access, 24/7.

As participants choose from among the benefi ts offered, our Dynamic Plan Cart™ tool automatically calculates the amount of fringe remaining. Participants can create various “what-if” scenarios to allocate their fringe benefi t dollars according to their individual needs. Once the participant has enrolled, they can see all contributions by pulling up the “Billing History” page. This supports complete transparency around monthly allocations of benefi t dollars.

Our online interface also simplifi es plan administration for employers. You can view, update, and upload plan information in real time.

• Pay missed premiums• Access coverage information• View and print contribution history• Add or terminate employees

• Upload census and payment fi les• Track enrollment statistics• Distribute information to all employees

CONTACT US FOR A DEMO OR VISIT OUR WEBSITE AT THECONTRACTORSPLAN.com TO SEE HOW MUCH EASIER MANAGING YOUR BENEFIT PLAN CAN BE.

THE CONTRACTORS PLAN BENEFITS PORTAL:

Laws pertaining to public works projects can be complex. Failure to comply — even inadvertently — can be costly.

One word sure to strike fear in anyone’s heart is “audit.” The DOL has increased the number of investigators on staff. It’s almost a certainty that any contractor working on a publicly funded project will be audited. In an audit or inquiry situation, the burden of proof is on the contractor.

1. What would you do if you received notice of an IRS or DOL audit?

2. If you currently have a prevailing wage benefi t plan, are you confi dent you could produce requested documentation showing appropriate fringe benefi t allocations in a timely manner?

3. Do you have doubts as to whether you’re correctly accounting for benefi ts you now offer in your prevailing wage benefi t plan?

4. Does your self-funded plan meet the criteria for a bona fi de benefi t plan?

5. Is your audit trail air tight?

6. Are you confi dent you and your subcontractors are in compliance with state and federal regulations?

7. Can you afford to be debarred from further federal or state work?

With the increased focus on compliance, it’s crucial for contractors to partner with an experienced company that provides full-service compliance support. When you partner with Fringe Benefi t Group, our team provides support at no additional cost. If you receive a DOL inquiry or notice of an IRS audit, simply contact us. We’ll work with you to design your response.

And since we handle your recordkeeping, we can quickly and easily verify deposits and provide requested reports and documentation.

We’ve worked with contractors and prevailing wage plans for over 30 years, and we’ve assisted many clients during audits and inquiries. We have established relationships with both the DOL and the IRS. And we have a representative in DC who can speak to the auditor on your behalf.

With an experienced partner like The Contractors Plan, audit questions can be resolved with little interruption to your work.

All these services are provided at no additional cost. Should the situation escalate beyond our scope, we can refer you to counsel with expertise in prevailing wage issues.

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1. What would you do if you received notice of an IRS or DOL audit?What would you do if you received notice of an IRS or DOL audit?

2. If you currently have a prevailing wage benefi t plan, are you confi dent you could produce If you currently have a prevailing wage benefi t plan, are you confi dent you could produce requested documentation showing appropriate fringe benefi t allocations in a timely manner?requested documentation showing appropriate fringe benefi t allocations in a timely manner?

3. Do you have doubts as to whether you’re correctly accounting for benefi ts you now offer in your Do you have doubts as to whether you’re correctly accounting for benefi ts you now offer in your prevailing wage benefi t plan?prevailing wage benefi t plan?

4. Does your self-funded plan meet the criteria for a bona fi de benefi t plan?Does your self-funded plan meet the criteria for a bona fi de benefi t plan?

5. Is your audit trail air tight?

6. Are you confi dent you and your subcontractors are in compliance with state and federal Are you confi dent you and your subcontractors are in compliance with state and federal regulations?

7. Can you afford to be debarred from further federal or state work?Can you afford to be debarred from further federal or state work?

TRY ANSWERING THESE QUESTIONS

T H E C O N T R A C T O R S P L A N ® Group Benefi ts | 13

/ M E D I C A L P L A N S E R V I C E S A N D F E E S /

The Contractors Plan is your benefi ts partner in the true sense of the word. We take care of most administrative and ongoing tasks, leaving you free to focus on your business.

Implementation Services• Develop a client-specifi c benefi ts enrollment portal where

employers and participants can view and update benefi ts information online at any time

• Distribute insurance coverage materials such as rate sheets and enrollment kits

• Obtain participant applications and forward to insurers

• Distribute ID cards (if not provided directly by the insurer). A sample implementation timeline can be found on the following page.

Ongoing Services• Maintenance of census database of covered participants

• Maintenance of accounting records detailing employer contributions, employee voluntary contributions, trustee transfers and ending balances

• Assistance with monthly premium collection and posting of contributions

• Transmitting premium payments to insurers

• Monthly reconciliation of carrier billing

• Collections tasks related to late contributions

• Monthly eligibility and hour bank reports

• New and corrected applications forwarded to insurers

• Assistance with carrier negotiations and solicitation of competitive bids

• Preparation of annual Form 5500

• Communication with brokers and employers regarding open enrollment and rate changes during annual renewal

• Call center provides assistance to plan participants with both English and Spanish speaking representatives.

PLAN FEES

All fees associated with your health plan are included in your pricing. You will not be charged additional fees for health insurance or specialty coverages (such as dental or vision) unless you request signifi cant customization of our services.

If you work with The Contractors Plan to set up retirement plans, additional fees may be charged. To see a separate fee schedule for using our retirement plans, please request one.

The table below illustrates a timeline for an effective date of 10/1, developed based on our experience implementing plans for hundreds of companies.

{ I L L U S T R AT I O N 4 - S A M P L E I M P L E M E N TAT I O N T I M E L I N E }

Task Monthly Group Hour Bank GroupExample Dates:

10/1 Eff Dt

Plan(s) & Rates Finalized 60 days prior 100 days prior 8/1 6/23

Employer Paperwork Completed 50 days prior 95 days prior 8/12 6/28

Employee Enrollment MaterialsRequested

50 days prior 95 days prior 8/12 6/28

Employee Enrollment MaterialsDelivered & Distributed

35 days prior 80 days prior 8/27 7/13

Completed Employer Paperwork Delivered to Home Offi ce

30 days prior 60 days prior 9/1 8/2

Deadline for Employees to Submit Enrollment Forms to Employer

25 days prior 70 days prior 9/6 7/23

Paper Forms Delivered to Home Offi ce 20 days prior 20 days prior 9/11 9/11

Initial Premium Payment Delivered To Home Offi ce

20 days prior 20 days prior 9/11 9/11

Enrollment Data Released to Carrier For ID Card Fulfi llment

14 days prior 14 days prior 9/17 9/17

Online EnrollmentEmployers and employees may enter their enrollments online rather than submitting paper enrollments to the home offi ce. Employer paperwork should be submitted as quickly as possible if this option is selected as it will take an additional 10 business days for access to the Client Management Suite portal to be completed from the time of case submission. Please include the names and email addresses of all employer contacts who will need online access.

/ S A M P L E I M P L E M E N T A T I O N T I M E L I N E /

T H E C O N T R A C T O R S P L A N ® Group Benefi ts | 15

Y E S , I T R E A L LY I S T H AT S I M P L E . A N D T H E E N T I R E

P R O C E S S I S M A N A G E D B Y T H E C O N T R A C T O R S P L A N .

Copyright © 2014 The Contractors Plan is provided by Fringe Benefi t Group. 11910 Anderson Mill Rd. / Austin, TX / 78726.

The Contractors Plan. The Prevailing Wage Experts. Davis-Bacon Act and Service Contract Act. Federal, State and Municipal.

THECONTRACTORSPLAN.COM / 1-800-328-1519 / INFO@CONTRACTORSPLAN.COM