In the modern economy, there is a shift towards a more direct relationship between employers and employees. One example of this trend is earned wage access (EWA), a payment method that allows employees to receive their wages directly into their own bank accounts. EWA has many benefits for both businesses and employees, including reducing payroll administration costs, improving cash flow management and allowing employees to manage their own finances better. In this post we’ll explore what is earned wage access, how it works and why it’s becoming so popular in the modern workplace.
The history of earned wage access
In the 1930s, earned wage access was first introduced by a company called Western Union. In the 1940s and 1950s, it became more common for companies such as Walmart and Amazon to use this method of payroll processing.
You can think of earned wage access as a way for you to get paid before your employer actually pays their own employees. It’s similar to direct deposit or ACH payments but with some key differences:
What is earned wage access?
Earned wage access is a system that allows employees to access their earned wages automatically and instantly. Earned wage access is different from traditional payroll, because it allows employees to choose when they want their paychecks deposited into their bank account instead of requiring the employer to make a deposit every week or two weeks.
Earned wage access benefits both businesses and workers in several ways:
- It reduces administrative costs for employers by eliminating paper checks and reducing the need for human resources staff members who manually process payments (or worse–don’t).
- It saves time for employees who can now spend more time focusing on work rather than waiting around all day until someone comes by with their check in hand (or worse–not).
- It increases productivity by keeping everyone happy! Everyone wins!
How does earned wage access work?
Earned wage access is an innovative new way for employees to access their earned wages. It allows them to view their paystubs and W-2s, as well as make changes to their payroll information if necessary. The employer can also see the payroll status of each employee at any time, which makes it easier than ever before for businesses to manage their workforce. This system has been shown in studies performed by Harvard University and Stanford University as being more effective than traditional paper-based methods because it allows employers more control over how they distribute wages while providing employees with greater flexibility over when they receive payments
The benefits of earned wage access
Earned wage access is a benefit to both employers and employees. It reduces payroll processing costs, improves employee morale, and reduces the risk of wage theft.
For employers:
- Earned wage access decreases the need for manual checks that are prone to error and may require additional human involvement. This means less time spent on payroll processing and more time doing other things like growing your business or making improvements in other areas of your organization’s operations.
- Earned wage access also helps reduce compliance risk by ensuring that employees receive correct payments at all times during their employment with you (or any other company). This reduces your liability if an employee files a lawsuit against you because he or she feels underpaid due to an error made by his/her employer during pay period calculations or other types of compensation calculation errors such as overtime pay calculations
How Earned Wage Access benefits businesses and employees
- Businesses save money by not having to pay for payroll processing costs.
- Businesses save money by not having to pay for employee benefits.
- Businesses save money by not having to pay for employee taxes.
- Employees save money because they are not paying for payroll processing costs
Is Earned Wage Access Right for You?
- Are you a small business owner? If so, earned wage access can be a great way to save money and increase efficiency.
- Do you work in payroll processing? Earned wage access allows you to streamline processes while providing your customers with better service.
- Are you an employee who wants to be paid on time? Earned wage access gives employees the ability to request their paychecks early or on demand, so they don’t have to wait for payday anymore!
Earned Wage Access isn’t just for people who are looking for jobs; it’s also ideal for those who need extra cash before payday rolls around–or even just want some peace of mind knowing that their bills will get paid no matter what happens!
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Earned wage access is a better method of payroll processing.
Earned wage access is a better method of payroll processing. It offers many benefits to both employers and employees, including:
- Convenience for employees. Earned wage access allows workers to choose when they receive their paychecks and how much they want deducted from each paycheck. This means that if you’re paid every two weeks, but only need $100 per paycheck, you can set up your account so that only $100 gets deposited into your bank account each time. Or maybe you want two checks instead of one–no problem! You can do that too! As an added bonus (and one which may not seem like much at first glance), this option also gives employees more flexibility when it comes to budgeting for bills or other expenses throughout the month since there won’t necessarily be any fixed dates on which money will come in (or go out).
Earned wage access is the future of payroll processing. It’s a better method that benefits both employers and employees, making it a win-win for everyone involved. If you’re interested in learning more about this technology or how it can benefit your company, contact us today!
