Software provider Fourth has partnered with the Wagestream platform to provide a system that allows hospitality workers to withdraw what they have earned up to that point at any time of the month.
The scheme, which employers can opt into, enables workers to see the total amount of money they have earned in a month – including tips - via an app. Employees are typically able to access 30-40% of their pay ahead of their monthly payment date. There will be no interest charge for accessing their pay but a £1.75 administration fee per transaction, regardless of amount, which can be paid by the employee or the employer.
Ben Hood, chief executive at Fourth, said: “Hospitality employees will now have more control over their cash flow, removing one-off payment pinch points to reduce the negative impact of financial stress and predatory pay day loan companies, and giving the opportunity to work an extra shift on a Friday to be able to buy the latest Nike trainers being released the next day – the power of this cannot be underestimated.
“This will make a fundamental difference to the lives of thousands of workers, in doing so generating a more motivated workforce, while reducing sick day frequency and creating a tangible point of difference in attracting and retaining the best staff – particularly amongst millennials and centennials who demand autonomy and control. This is the future of payment and we’re delighted to be at the forefront.”
Peter Briffett, chief executive at Wagestream, added: “I firmly believe this partnership will have a long lasting and material impact on the financial health of UK hospitality workers, who have been prayed on for too long by greedy pay-day loan companies. This move will further encourage all employers in the industry to put the financial and mental wellness of their staff firmly at the top of the agenda.”