Pay day revolution on the way?

A small but growing number of employers are experimenting with an alternative, earn-as-you-work approach.

A pay day revolution could be on the way as a growing number of employers experiment with alternative salary systems that let workers access their cash as soon as they earn it.

Abandoning the traditional structure of weekly, bi-weekly, or even monthly pay days, some employers are now are testing ways to give employees faster access to wages they’ve already accumulated.

According to a report by The New York Times, Goodwill of Silicon Valley began testing a system eight months ago which lets workers withdraw up to half of the wages that they’ve already earned from their next paycheck, to a limit of $500.

“When you have people living on the edge, very small things can cause a rapid acceleration into very bad conditions,” chief executive Michael Fox told the news outlet.

“If you’re just $60 or $90 short, and can’t make a rent payment or buy medicine, it spirals,” he added. “One little thing creates a huge disaster.”

More than half of Goodwill’s 300 eligible employees have used the option at least once.

While the services that provide on-demand wages do charge fees every time a worker uses them, the cost is nothing compared to payday loans and could save employees from serious financial stress.

In a time when financial stress is often cited as the leading worry for employees across multiple industries, the alternative approach could let employers help workers out without actually giving them a costly pay rise.

For all the latest HR news and info straight to your inbox, subscribe here.

More like this:

Funded jobs program doubles in size

Tell-all book attacks Facebook’s culture

Friday deadline for Canadian HR Awards

Recent articles & video

Redefining care: the evolution of mental health support for millennial women

Google fires employees involved in April 16 protest: reports

Early-career women cite remote work as career asset amid male-dominated offices

Province confirms minimum wage increases for 2024

Most Read Articles

Nearly three-quarters of middle managers in Canada experiencing burnout: survey

Budget 2024: Public service to lose 5,000 workers

Alberta launches new compensation model for doctors