Workers can leverage corporate tax cuts for raises, job offers

Personal Finance

Thanks to the new tax plan, now may be the time for workers to negotiate for a bigger paycheck.

During his State of the Union address, President Donald Trump boasted that the Tax Cuts and Jobs Act has benefited a number of U.S. workers due to the lower corporate tax rate, which was permanently slashed to 21 percent from 35 percent.

Big-name companies including Home Depot, Apple and J.P. Morgan Chase have announced plans to invest in their employees by providing bonuses, wage increases or increased retirement contributions.

It’s unclear whether that will become a broader trend.

Two-thirds of companies say they plan to or have already adjusted employee benefit programs in the wake of the new tax law, according to a recent survey from Willis Towers Watson, a global advisory company. The firm surveyed 333 midsize and large employers in early January.

Another survey, conducted by global professional services firm Aon in early December when the Tax Cuts and Jobs Act was being finalized, was less rosy.

Of the companies that knew their plans after the passing of the legislation, 83 percent did not expect to increase wages, and 73 percent did not plan to distribute bonuses. (Aon polled 240 midsize and large employers.)

Whether your company has plan in place or not, experts agree that the new tax code creates a good opportunity to approach your boss about a raise or other compensation improvements.

“There probably hasn’t been any better time in the last 25 years or more,” said Ken Abosch, a broad-based compensation leader for Aon.

Here’s how to take advantage:

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