How Earned Wage Access Can Reduce Your Staff Turnover

In today's competitive job market, retaining top talent is more important—and challenging—than ever. High turnover rates can lead to increased costs, disrupted workflows, and low employee morale. However, one tool that is gaining traction among employers and HR professionals to help reduce turnover is Earned Wage Access (EWA), also known as On-Demand Pay.

What is Earned Wage Access (EWA)?

Earned Wage Access, or On-Demand Pay, allows employees to access a portion of their earned wages before their scheduled payday. This means that rather than waiting until the end of the pay period, employees can tap into their earnings as they need them. This can boost employee financial flexibility, acting as a game-changer for many workers, particularly those living paycheck to paycheck.

To learn more about Earned Wage Access, read here or check out the following video:

The Impact of Turnover on Your Business

Employee turnover is a persistent cost for many businesses. This cost can be financial, resulting from recruiting, hiring, and training new employees is expensive. It can also be a productivity cost, resulting from new hires requiring a ‘transition period’ while they to get up to speed. Earned Wage Access, or On-Demand Pay, can help in reducing turnover, and in turn, these costs.

Benefits of Implementing Earned Wage Access

Here are several ways Earned Wage Access can help reduce turnover in your organisation:

1. Improves Financial Wellbeing

Financial stress is a significant concern for many employees. By offering Earned Wage Access, you help your employees manage unexpected expenses and avoid costly payday loans or overdraft fees. Good financial wellbeing can lead to higher job satisfaction and lower turnover rates.

2. Enhances Recruitment

Offering Earned Wage Access as a benefit can make your organisation more attractive to potential hires. In tight labour markets, employee benefits like this can set your company apart from competitors, making it easier to attract and retain quality talent.

3. Boosts Employee Morale

When employees feel supported financially, they are more likely to be engaged and committed to their roles. Earned Wage Access aids in demonstrating that your organisation cares about their wellbeing, which can boost morale and foster a loyal workforce.

4. Reduces Absenteeism

Financial difficulties can sometimes lead to absenteeism, as employees may need to handle personal matters during work hours. Earned Wage Access provides the financial flexibility they need, reducing the likelihood of unplanned absences.

Companies using Level’s solution have seen up to 13% less absenteeism.

5. Increases Productivity

A financially stressed employee is less likely to perform at their best. By alleviating some of their financial worries, Earned Wage Access allows employees to focus more on their work, potentially leading to increased productivity.

6. Customisable and Easy to Implement

Modern Earned Wage Access platforms are designed to integrate seamlessly with existing payroll systems, requiring minimal effort from HR departments. This makes it a viable option for organisations of all sizes.

Level is already integrated with most of the leading HR, payroll and rota systems (see here for integrations). If you don’t see the service you use on this list, don’t worry! Our dedicated technical team will work to integrate Level with your provider as part of our onboarding.

Case Study

Many companies have already seen the benefits of implementing Earned Wage Access. For example, Capita, who are in an industry with staff turnover double the UK average, saw staff turnover reduce by 50% after introducing Level, and On-Demand Pay.

Read more about Capita and Level here.

Conclusion

Reducing turnover isn't just about offering competitive salaries and benefits. It's about understanding and addressing the underlying issues that cause employees to leave. Earned Wage Access, or On-Demand Pay, is a powerful tool that can improve employee financial wellness, enhance recruitment efforts, and boost overall employee satisfaction.

Ready to see how earned wage access can transform your workplace? Start exploring Earned Wage Access solutions today and take a proactive step towards building a more stable, productive, and engaged workforce.