All You Need to Know About On-Demand Pay

On-demand pay is a method of paying employees their wages as they earn them. This gives employees access to their earned pay instead of waiting for traditional weekly, bi-weekly, or monthly payday cycles. Learn about the different types of on-demand-pay models.

The cost of on-demand pay involves evaluating hard and soft costs for both employers and employees. There are various costs associated with implementation including hidden costs that you should consider.

Getting started with on-demand pay requires planning across your organization. Planning for an on-demand pay implementation involves several key considerations like vendor partnerships, security, training, etc. You’ll most likely need to assemble a core team of planners and implementers that span HR (employee experience), payroll (process and compliance), IT (integration and implementation), your HCM provider (integration, implementation and process) and your on-demand pay provider.

When considering on-demand pay providers, evaluate the overall employee experience ranging from service, the solution, and rollout. The real test is your employee satisfaction with the program. Ensuring that your employees benefit from the best on-demand pay experience increases the likelihood of employee adoption and engagement which may translate to reduced turnover and its associated costs for your company.

After rolling out an on-demand pay program, you must measure the success of your investment based on your goals and KPIs. There’s a scorecard system you can use to evaluate your efforts.

When selecting an on-demand pay provider, consider how it will improve the employee experience and evaluate their security and privacy standards. This evaluation process requires collaboration across different departments in your organization including HR, operations, payroll, finance, and legal.

One of the potential benefits of on-demand pay is more support for your company’s diversity, equity, and inclusion. One of the easiest ways that companies can quickly work toward greater financial equity and inclusion is by taking a comprehensive look at the benefits packages and consider how on-demand pay and financial literacy resources may meet employees’ needs. Unlike traditional financial wellness tools, on-demand pay can be considered more of a financial inclusion benefit. On-demand pay can empower employees with more choices and opportunities so they can avoid fees by giving them access to their money as they earn it.