'It's become a tool that gives a lot of flexibility financially to frontline workers,' says expert
Earned wage access (EWA) is going to be the next big move for companies globally, according to one expert.
“The leading global employers have all adapted flexibility as an ethos in their workforce, and the next wave of that is adding things like earned wage access,” says Will Eadie, chief revenue officer at WorkJam, in talking with Canadian HR Reporter.
In particular, the move would benefit frontline workers in different sectors who are paid hourly, he says.
Without EWA, an hourly employee – who’s making just enough to pay for rent, food and health care needs, for example – would struggle should an emergency arise, Eadie says.
A flat tire could hurt that worker, but something worse – a doctor's appointment or a sudden need for medication, for example – could be disastrous to the employee, he says.
Employee attraction with earned wage access
EWA can also help employers attract workers, says Eadie.
“It's become a tool that gives a lot of flexibility financially to frontline workers, but it also has become a tool to really help top corporations attract talent,” he explains.
With this benefit under their offering, employers can say: “Hey, we're going to give this as a benefit that we're offering to make us a great place to work’.”
This could be the determining factor that sways one worker to go work for Company A over Company B, he says.
More than one in five (22%) Canadians are participating in gig work of various kinds across the country, according to a previous report from Securian Canada.
‘No risk’ to employers offering EWA
Just about every company can benefit from offering EWA, says Eadie. And while hourly workers would benefit the most from the program, all workers would enjoy it as well.
“I would never make a blanket statement that it works for everybody. I'm sure there's a use case here or there that I haven't thought of. But we have not seen any environment where it doesn't work,” he says.
And there’s no risk to employers in offering workers EWA, according to Eadie, “because what you're doing is you're just giving someone access to the money they've already earned. You're not taking risks. We're not giving them money that they haven't earned. It's not a loan.”
Recently, digital frontline workplace WorkJam launched a partnership with EWA provider DailyPay where workers can access wages they have already earned using an app on their phone.
“If you've already set up your account, we already know that it's going either to a debit card or to your bank account via ACH transfer,” says Eadie, and WorkJam does not allow workers to withdraw all their earnings in one transaction.
In February, Canadian HR Reporter reported about a businessman in Toronto who continues to face claims of wage theft and government orders to pay employees even though he still owes workers a total of about $290,000 of unpaid wages.
