While Ceridian announced in 2018 that they would offer a real-time pay algorithm, called Dayforce On-Demand Pay, it took them two years to full years to go to market with their digital wallet. While they were developing their product, Branch launched their own on-demand pay digital wallet.
At DailyPay, we applaud any efforts that employers make to relieve their employees’ financial stress by offering them a flexible pay option, so while we are happy to see the marketing expanding, we firmly believe that every company deserves the recognized Gold Standard in on-demand pay.
Since 2018, the on-demand industry has experienced a major boom. New payday advance or pay-on-demand pay apps have entered the marketplace. When integrated with an employer’s payroll system, this technology lets employees request and receive all or part of their accumulated pay — as soon as the day after they perform the work.
While this type of immediate access can be helpful and motivating to employees, companies should use caution before broadly adopting this approach to pay delivery.
Some on-demand pay providers, for example, require the payroll team to take on additional workstreams. In order to make sure that your organization has a positive experience with on-demand pay, be sure to choose a provider with a recognized gold standard approach to service, flexibility and compliance.
Elevating the On-Demand Pay Category
In order for a company to offer the daily pay benefit, there are really three things that need to occur:
- Someone has to know how much the employee worked.
- Someone has to calculate the net pay amount associated with those hours.
- Someone has to fund and remit those payments.
At DailyPay, we do all three. We have designed advanced technology to convert an employee’s raw punches into a net pay amount and DailyPay also funds those payments so the employer doesn’t have to.
We are excited that there are more and more companies joining the on-demand pay industry, as it is hard-working employees who will reap the rewards. But, at the same time, we want to make sure that employers make educated choices when selecting their on-demand pay provider. We also expect that there will be some companies who might be able to run and fund daily pay themselves and, in the process, help their employees.
Other companies will prefer to have us do it for them – without having to approve each payment – and leverage the power of these types of innovative payroll algorithms.
One might imagine a perfect world where you get the benefits of both not having to run payroll yourself, while having employees receive their true earned income ahead of payday.