Unlocking Employee Financial Flexibility with Earned Wage Access
In recent years, Earned Wage Access (EWA) has emerged as a beneficial financial service for employees looking for financial flexibility. EWA gives employees the ability to access their earned wages before payday, empowering them to manage their finances more effectively. It has revolutionized how employees interact with their earnings and made it easier for workers to pay for expenses as they arise without having to pay late fees, overdraft fees, or resort to predatory payday loans. While the benefit to employees is immense, an EWA program can also complement your broader financial wellness programs as well as positively impact your business in terms of reduced turnover, lower absenteeism rates, and boosted productivity, while providing a gain in competitive advantage and increased retention for employers.
What is Earned Wage Access?
Earned wage access empowers employees to receive a portion of their earned wages ahead of the standard payday, providing crucial support for unexpected expenses or bridging financial gaps when funds are tight. With EWA, employees can request an advance on their earned income, which is different from a traditional loan because it gives access to wages they have already accrued rather than borrowing against future pay. This forward-thinking payroll solution allows employees to access a portion of their earned income before their regular paycheck is issued. EWA integrates seamlessly with existing payroll systems, complementing the regular paycheck process and enhancing the efficiency of paycheck distribution without disrupting established payroll schedules. This approach is gaining traction across various industries such as fast food, retail, and healthcare, as it fulfills a growing demand for greater financial flexibility among employees.
EWA In Action
EWA gives your employees access to funds they’ve already earned but have not yet been paid due to traditional pay cycles, such as bi-weekly or monthly schedules, helping them address cash flow issues that can arise from irregular income or unexpected expenses.
With EWA, they’re free to access a percentage of the wages they’ve already earned whenever they want. This process eliminates the need for borrowing money or taking payday loans, providing financial flexibility without high-interest debts or fees.
Employers are removed from the process, allowing employees to log into the EWA app provided by an earned wage access provider (EWA provider) to check their earned wages. Employees can access up to 50% of their already earned wages for at most a $5 fee, with fee-free payout options available. Users can transfer funds to their bank account, card, or cash pickup options, and instant pay is available for quick access to money. EWA platforms also help users save money by avoiding costly alternatives and may offer rewards such as cashback or other incentives to enhance financial wellness.
An employer’s payroll service provider reconciles pay records to make sure that the employer’s ledger matches the distribution to employees. Employees repay the amount accessed when they receive their regular paycheck; this is not a loan, but simply an advance on their earned wages. For employees to be eligible, organizations must partner with an EWA provider.
With EWA, at payday, the remaining pay is calculated, and standard deductions are taken out.
How We Can Help
Axiom clients and their employees can now access earned wages in just minutes with our Earned Wage Access (EWA) solution from ZayZoon. Designed for small and midsize businesses, EWA offers solutions specifically tailored for small businesses, providing seamless integration and cost-free services to support their unique needs and enhance employees’ financial wellness. EWA helps employees manage cash flow between paychecks. The impact is clear: 79% of hourly workers would switch to an employer offering EWA, and 1 in 3 say financial stress affects their performance. Businesses that offer EWA see a 29% reduction in turnover, twice as many job applicants, and an average of 12 fewer days of absenteeism per year. With ZayZoon, employees can get on-demand pay instantly through direct deposit, Venmo, VISA prepaid card, gift cards, or even a gas card—at no cost, liability, or risk to the employer. Contact us today to learn how you can offer this feature to your employees.
