The holidays are a busy time for many commercial businesses. Consumers are out shopping, gathering with friends and family, and generally spending their time (and money) celebrating. During this crucial earning period, it can be beneficial to extend your hours and have more employees on hand to take care of the additional customers.
Unfortunately, the holiday season often means your employees are busier than ever as well. Winter brings shorter days, cooler weather, and a struggle to accomplish all of those tasks that everyone is trying to complete. When your business is booming, your employees are often welcoming guests into their homes, taking care of holiday shopping, under the weather, or traveling for holiday celebrations. Hourly wage earners are a valuable asset to your business, and you want your employees to be engaged and happy. So, how do you get your employees to work those extra hours during the holidays without being a total Scrooge?
Immediate Benefits Provide Incentive
Your employees are working for a paycheck that they'll receive next week or next month. While all employees have a clear understanding of working regularly to pay scheduled bills, focusing on work during the magic moments of the holiday season can be difficult. It's the one time of the year where most people take the time to focus on family, friends, and the things that truly make life special. Additionally, the holiday season comes with extra expenses to worry about. Sadly, for many people, financial stress outweighs holiday cheer during the most wonderful time of the year.
While you can't provide your employees with a few extra hours to get things done, you can offer some financial relief during the most expensive time of the year. Immediate benefits can supply workers much-needed funds now instead of in the future. Early wage access (EWA) allows your employees to get a portion of their paycheck instantly to pay for emergencies or other immediate expenses. Since this is income they've already earned, there's no worry about interest rates or transfer fees. The ability to access wages early could be the incentive your employees need to pull a few extra hours during the holiday season.
How Early Wage Access Works
Early wage access (EWA) is a relatively new concept that provides employers with a simple way to offer their workers more control over the wages they earn. Although many businesses pay weekly, 78% of Americans are still living paycheck to paycheck. That means if an emergency (or even common necessities like school clothes) crops up, these workers are forced to take on debt to take care of the issue before payday. These financial worries add up to stress for workers. A recent SHRM study revealed that 48% of workers are stressed about simply covering basic living expenses. This stress has a major impact on employees' overall health and daily performance. Financial stress seeps into the workplace in the following ways.
- Increased stress in more than half of employees leading to lower morale
- Poor health leading to increased tardiness and absences
- Lower productivity due to an inability to focus
When employers partner with a third party provider to offer early wage access, employees can get a portion of the money they've already earned instead of waiting until payday to take care of the financial issues making them stressed. Workers can access the EWA service through an app and instantly make a deposit without worrying about transfer fees or taking on additional debts.
As an employer, you can set limits on the amount that can be withdrawn and take advantage of other benefits to help employees gain financial stability. The set-up process is easy and employees can sign up and navigate the whole process using a smartphone. This increased freedom finally allows employees to access income they've earned without having to ask for permission or an advance. By empowering workers with financial control, engagement increases and employees have the incentive to pick up additional shifts when they need to earn a little extra money.
EWA Builds Morale During the Holidays
Sadly, financial stress often increases during the holidays. In fact, 38% of people report more stress during the holidays, with almost half attributing financial worries as the main cause of that stress. The result is often a major drop in productivity during the holiday season.
This spells trouble for commercial businesses who depend on the increase of customers the holiday season brings. Balancing the needs of your workers with the desires of your customers can be a difficult situation. Offering EWA to hourly wage earners can help. Since you're not forcing a change on your workers, you empower them with additional ways to meet their needs during the holidays. EWA can provide workers with these benefits to add cheer to their holiday season.
- Instant income to cover travel, shopping, entertaining, or whatever unexpected expenses the holidays bring
- Avoid additional debt
- Financial incentive to pick up extra shifts to improve financial stability
Multiple Benefits Work Together
Early pay companies often provide additional features to help employees achieve financial stability. These benefits work to together to provide more choices and freedom for workers. In addition to instant paycheck advances with no overdraft fees, Branch allows staff members to manage work schedules from the smartphone app. At a glance, workers can see the shifts they're scheduled to work and potential earnings. Available shifts are also made visible so employees can claim the hours they need.
During the holidays when flexible schedules are vital for both employers and employees, easy access to available shifts can make all the difference. Employees can choose the extra hours when they're available to work, and managers can alert workers when they end up swamped with an unexpected rush. Since employees can anticipate their earnings, then access pay instantly, they're more likely to take extra shifts to fund holiday spending.
Avoid Holiday Debt
You've likely heard the old saying "'tis better to give than to receive," and it seems to be true. Americans love shopping during the holidays, and the absence of available funds doesn't appear to be a stumbling block. Unfortunately, poor spending habits during the holiday season can follow consumers many months into the new year. If your employees are facing financial hardship during the holidays they're likely to be among consumers facing the following holiday debts.
- Credit card debt: The average American takes on more than $1,000 in credit card debt during the holiday season, and at least half will take longer than 3 months to pay it off. This results in a significant loss to interest payments.
- Overdraft fees: The overdraft program provided by most banks was designed to cover spending beyond the limits of an account. However, many consumers use the service as a form of credit. This is particularly expensive since overdraft fees average around $35 for each incident.
- Overstretching the budget: Sometimes, holiday spending leads to unpaid bills. While necessities like utilities might not be shut off immediately, late fees often apply. These fees add up quickly, leading to significant debt.
- Missed work hours: Inevitably, the busiest season of the year means an occasional missed day of work. Whether your employees need time off for travel, last-minute shopping, or preparing to host holiday meals, missed work means missed wages. Without proper planning, these days can lead to financial issues before the new year arrives.
- Higher living expenses: During the winter, days are shorter, the heat is always on, and visitors can help elevate regular monthly expenses. When grocery, utility, and travel bills are higher than ever, turning to debt can seem like the only answer.
- Medical bills: For many families, the winter season brings more illnesses into the home. Sadly, insurance benefits for those facing financial hardship don't always cover unexpected illnesses. Viruses and infections can quickly lead to additional debts.
Early wage access can help workers plan ahead to avoid the debt many people come to expect over the holidays. Instead of accepting the likelihood of increased debt this holiday season, your employees can use EWA to plan for extra spending. An EWA app can provide a way for workers to track upcoming bills, monitor spending habits, and get alerts to avoid late fees. Taking advantage of this option is a great way to plan for the holidays. Once a plan is in place, the ability to predict earnings and pick up additional shifts to earn extra cash can help employees avoid taking on extra debt. Finally, instant access to early wages provides spending money, boosts employee engagement, and provides incentive for workers to pick up extra shifts.
EWA can provide employers with a way to fill all the extra shifts of the holiday season without being a Scrooge. Instead of being forced to hire additional (often inexperienced) workers for the holiday season, employers can provide reliable employees with the opportunity to pick up extra shifts at their convenience. Employees will be empowered with the ability to finally make their own choices and have access to funds they need during the holidays. Contact Branch to learn more about early wage access and complimenting features that can help your employees reach financial responsibility.