How earned wage access can improve employer-employee relationships

Employers around the world are seeing the effects of ‘The Great Resignation’ as employees look for greater work-life balance, and the businesses facilitating this are reaping the benefits. Flexible working practices are here to stay but this stretches far beyond just allowing employees to choose their place of work. Resignation rates are at an all-time high, with one study by Hays Gulf Region suggesting 56 percent of employees may look to switch roles during 2022. Employees are demanding flexible hours, more perks and, increasingly, flexible access to their pay.

EWA offers just that; flexibility. EWA allows employees to access their earned wages between the traditional monthly, bi-monthly or weekly pay cycles. Employees accrue pay on a daily basis, like they would annual leave, and can then withdraw what has been accrued as they wish. This has huge benefits for employees by giving them flexibility and control over their finances and removes the stress that comes with budgeting between pay-cycles.

Crucially, for the employer, platforms like FlexxPay provide such services to companies and their staff at no cost to their business. We also add further services such as remittances, world-wide mobile top up, gift cards and vouchers.

EWA has five core benefits, each of which are applicable to both employees and employers.

Reduced financial stress for employees

According to a recent PWC survey, more than 50 percent of employees are stressed with 59 percent citing financial matters as the cause of that stress. It is having a profound effect on employees’ wellbeing and, for employers, it means reduced productivity along with greater difficulty in retaining staff. EWA alleviates this issue by allowing employees control over when they are paid, enabling them to align their income with their financial commitments and ensuring greater financial stability.

Increased productivity

Employers across the world are dealing with the effects of the pandemic and getting the most from employees is crucial to remaining competitive. As businesses begin to accept flexible work practices and become more employee-centric, they must ensure that productivity isn’t impacted. EWA facilitates this by alleviating employee stress, which has a direct impact on productivity. According to PWC, 35 percent of employees state that financial worries have impacted their productivity at work and, a business with 1,000 employees, may lose over $300,000 a year due to both productivity loss and low retention rates.

Reduced absenteeism

With increased productivity comes reduced absenteeism as employees have more control over their pay and their work. As employee stress is reduced, they become more motivated to come into work as they see the impact of their day’s work in real terms and can realise this value as they wish. They can also see that employers are proving their commitment to their wellbeing in real-time. This helps increase trust in your company which reduces turnover, improves employee satisfaction and ensures a better company culture. In fact, research shows that flexible wage access can reduce absenteeism by up to 20 percent.

Supports recruitment

As employees seek more flexibility in their work, EWA can be a major attraction when it comes to recruitment. EWA is a low-cost, high-value employee benefit that makes a real difference to staff. The job market worldwide has never been more competitive and, as flexible working becomes the norm, employers must use unique options such as EWA to set themselves apart from the crowd. By using EWA, employers are setting themselves up to recruit the best talent with a standout employee value proposition.

Reduced HR and finance workload

An EWA solution can also remove the administrative burden of early salary demands and advances on payroll, reducing the pressure on HR and finance teams. With many businesses operating worldwide, EWA platforms can handle requests for wage access across multiple countries’ payroll schedules. Salary advance requests are also automated, eliminating the manual processes which, in-turn, reduces costs. Over the course of a year, a typical business could save 10 working days in HR and finance workload.

The pandemic has had seismic effects on the nature of work and there’s no doubt that flexibility in all aspects is now the number one priority for employees. A 2019 study by VISA found that 95 percent of employees are interested in working for an employer who provides EWA and, as an employer, it will soon become crucial to employee retention. In fact, Employee Benefits News calls EWA, “the most important benefit in a post-Covid-19 world.” EWA shows employees that they are truly valued and, from an employer’s perspective, can be a simple tool with a significant positive impact.

Michael Trüschler, co-founder and CEO of FlexxPay.