McDonald's Franchisee Offers Employees Daily Access to Earned Wages via Mobile App

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McDonald's Franchisee Offers Employees Daily Access to Earned Wages via Mobile App

By Ed Shaw, Executive Vice President, Human Resources and Risk Manager for Caspers Co. - 07/31/2017
Financial wellness and employee retention go hand-in-hand, and they go beyond loyalty programs and company level discounts. Job dissatisfaction comes from the absence of financial resources to foster a sense of security. As Executive Vice President, Human Resources and Risk Manager for Caspers Company, responsible for 53 McDonald’s locations across Tampa Bay, I know first-hand the substantial cost that employee turnover and the associated ongoing recruiting, hiring and training has on our hospitality businesses. The food service industry can be a revolving door, but with the help of a new technology, one that strengthens employees’ financial wellness by allowing them to access half of their earned wages after a shift, we’ve been provided with valuable insights on how to retain existing workers while attracting new hires.
 
In an effort to create new incentives for our staff, we discovered a program by a company called Instant Financial that allows us to seamlessly offer employees daily access to their earned wages at no additional cost. We felt it was a good opportunity to further position ourselves as industry leaders and improve the financial wellness of our staff. The daily pay solution provided by Instant is simple from the employee side. After completing a shift there’s a four-hour time frame where 50 per cent of the employee’s earned wage can be taken at no cost through the Instant app. This gives them the opportunity to pay bills on time, fill up the car with gas and buy a few groceries before payday without having to turn to other costly lending solutions to make ends meet, or borrow from friends or family.
 
We started a six-month pilot phase to introduce the new system in our locations; almost instantly we saw change. It was so beneficial that before the pilot was over, we had seen enough value to continue the service indefinitely. We witnessed an improvement in a few key areas:
 
Scheduling – Managing a franchise such as McDonald’s means there’s always a tug-of-war from employees taking unexpected sick days and trying to find people to fill those shifts. Providing control to Employees to be able to access a portion of their earned wages daily not only reduced absenteeism, but made it easy to find coverage for open shifts. The incentive of having daily access to these wages, at no cost, was the defining factor. 
 
Overall satisfaction – Morale is at an all time high after implementing the Instant Pay program; we’ve noticed better customer service scores related to a generally positive attitude from our employees. The access to earned wages removes financial stress, which in turn is creating happier and more engaged staff; a content team resonates with our customers.
 
Improved Loss Prevention – Financial wellness for employees is important for reducing the amount of theft within the organization. The mentality and shame behind taking products is often the result of poor financial stability. Having instant access to pay reduces the temptation to steal and puts the employee in better control of their finances and puts the meal they need within the grasp of their own money.
 
As I think about the success we have had with this new technology, I think the core value is really more simply “alignment.” With Instant, we have put employees in control of accessing their pay, and this falls in line with the Millennial way of thinking; their desire for instant access is addressed, while the use of an app treads familiar ground. How they access their pay is now aligned with the rest of their life. There has been some initial concern about allowing people to take 50 per cent of their wages early, which might lead to irresponsible spending, but unequivocally the exact opposite has been proven true. Of all of those who opted in for Instant Financial, only a quarter of our employees access their pay on a daily basis. Some are reluctant to try this service because it actually seems too good to be true, but as time goes on, and the app includes more functionality, we believe there will be even greater adoption.
 
The idea of instant pay has clear benefits for the hospitality industry; it has the function to distribute tips, which traditionally was always a touchy subject in casinos, restaurants, and cruise ships. The biggest savings is time, because industries that rely on counting distributing tips evenly spend a lot of time and resources sorting through the process daily.  As the conversation opens about having freedom to access wages, the Instant technology will become more popular over time and will even grow to be the standard for how employees are paid. The millennial population is taking the reigns of the workforce and is already demanding innovation. Our goal was to be ahead of the curve and be a leader in employee satisfaction. The reality is that your employees have already earned the wage, so it is really their money anyway.
 
What started as a trial to invigorate our employees became a solution to common problems faced in the foodservice industry. It’s a radical, but mutually beneficial shift that’s changing the mentality and expectations around how employees are paid.

Ed Shaw is the Executive Vice President, Human Resources and Risk Manager. He has 45 years with Caspers Company, having started in Operations in 1972, moving into HR and Training in 1978, and Risk in 1979.  Ed spent 20 years as Training Manager creating and conducting highly successful programs that reduced crew and management turnover below national and local norms.  Ease of hiring and on-boarding are key factors in creating a smooth running process for new hires.  Instant pay blends into the company goals of ease of implementation, along with a high level of results coupled with improved morale.