- Instead of waiting two weeks for a paycheck, Walmart employees will be able to access their pay for the hours they worked through an app, The New York Times reports. The world's biggest retailer says it's offering the service to help ease workers' financial struggles, discourage their use of costly payday loans and other debt-relief options — and keep them focused and productive on the job.
- But labor groups say Walmart should instead raise wages. According to The Times, Walmart's starting wage is $9/hr, which is $1.75 above the federal rate, but below Costco's rate of $13/hr and Target's $11/hr. On average, Walmart workers earn $13.85/hr, compared to Costco's $24.50/hr.
- Walmart executives argue that raising workers' wages doesn't solve their money management problems. The app, called Even, connects to workers' bank accounts and calculates how much money they have to spend between paychecks to cover household and other expenses.
Other high-profile employers, mostly retailers and restaurant chains such as McDonald’s, Uber and Outback Steakhouse, now allow workers to access their pay on a same-day basis through apps.
Low-wage earners often live paycheck-to-paycheck. Turnover is high in the retail and hospitality industries, so workers might find having instant access to their funds an attractive benefit. Employers pick up the cost of some services, but employees can be charged as much as $3 a day to access their funds.
It may be an assumption among Walmart and other companies offering same-day pay benefits that workers' money management skills will be positively affected by the service. But employers should be cautious about adopting programs or services focused solely on what they think employees might be doing incorrectly.
Financial wellness is no longer something for which HR can shirk responsibility. Statistical evidence is clear in showing a drop in workers' financial well-being as well as a growth in the amount of debt owed, the latter particularly caused by student loan debt. It's up to employers to provide support for the entire spectrum of wellness, and that includes educating younger segments of the U.S. working population and assisting that group to adjust financial behavior.