Sidestep the complexities of Earned Wage Access: Provide an important benefit to attract and retain the right team

In a competitive labor market, restaurant owners need every tool at their disposal to attract and retain productive employees and reduce turnover. Earned wage access (EWA) has become an important incentive for hourly workers. But many owners are reluctant to offer EWA because of the considerable technical challenges it often brings.

In this article, we’ll take a look at what EWA is, why it’s important to your employees, and how restaurant owners can partner with experts to make EWA implementation relatively fast and simple.

What is earned wage access?

EWA is just what it sounds like: a way for your employees to access wages they have earned before the traditional payday. Importantly, this is not a payday loan or advance on future earnings. But it does serve the same purpose for many restaurant employees.

Specifically, EWA is an attractive option for the 34% of employees who are living paycheck to paycheck, according to Bankrate survey data. This means they have little to no money left over for savings after they pay all their monthly bills.

With EWA, workers can get paid earlier when their current financial needs don’t align exactly with their normal pay schedule. Access to early pay can be a huge relief for employees who need to make rent, repair a vehicle unexpectedly, or have any other number or emergency expenses.

EWA is a significant advantage for restaurant owners

According to two different studies cited by payroll and POS provider Toast, offering EWA to employees can nearly double the applicant pool and increase hiring speed. It can also help reduce turnover by retaining employees who might seek a job with a competitor down the street that does offer EWA.

Reducing your employees’ financial stress also helps them focus on their work and be more productive. In fact, for one Wendy’s franchise, introducing EWA reduced cash-till theft by 80%.

Finally, it’s important to note that EWA providers do not charge restaurants for this service. In many cases, it’s also free for employees, although in some cases there are small transfer fees for employees to access their pay early.

How does earned wage access work?

While the concept of EWA is simple, making it happen can be technologically challenging. The reason for this is the sheer number of systems involved. A typical EWA configuration can require integration among timekeeping, POS systems, back-of-house systems, and payroll, along with the EWA provider’s platform.

System integration is essential to any program’s success, because EWA depends on always knowing the answers to these two questions:

1. Which employee is using the EWA service?
2. How much earned pay can the employee access?

The first question can be difficult to answer because the many systems involved do not necessarily use a consistent employee ID. If the employee IDs in the timekeeping and payroll systems don’t match, for example, computing EWA accurately can be a huge issue. This is one of those little details that can make the process very confusing if not given its due attention.

The second question can be trickier to answer because it requires knowing how many hours the employee has accrued to date, which affects how much pay they are eligible to access in advance of payday. This may involve clock-in/clock-out times or log-in/log-out times from POS systems, depending on the store. It may also involve accessing or updating the file that will be sent to your payroll provider.

What complicates all of this is that these systems were not designed to work together, let alone seamlessly. At the same time, restaurant owners are understandably focused on running their business and optimizing customer experiences, not on figuring out complex IT integrations. All of this can make EWA difficult, time-consuming, and frustrating to implement and manage — and leave restaurant owners feeling like the entire project might not be worth the hassle.

Find the right partner for easier EWA

Fortunately, Delaget can help make EWA adoption a practical reality for restaurants of all types and sizes. As restaurant data specialists, we understand every nuance of these complexities intimately. We also already work with the key players involved, so we can help you make the connections required to facilitate a timely and accurate EWA implementation.

That may mean literal connections, like bespoke integrations between payroll, POS, and EWA platforms. It may mean professional connections, like brokering introductions to the right EWA partner for your franchise, including DailyPay, Payactiv, Rain, and many others. We also provide effective solutions for matching employee IDs accurately and seamlessly across back-of-house systems to eliminate these headaches.

Don’t let the back-end complexities of EWA prevent you from putting this popular benefit front and center. As the holidays approach, your employees need EWA more than ever — and you need your employees to keep working for you throughout this busy period. EWA is the ideal way to attract and retain your best workers while giving them some much-needed financial stress relief.