Woman getting cash at ATMrecruit anyoneturnoverdaily pay benefit1. What's to prevent my employees from spending allof their money before payday, leaving them worse offfinancially?2. Can I limit how an employee usesit?3.How do I roll this out?4. How do I getmy payroll team on board?

  • Funding: Your payroll team is focused onensuring the company does not fund employee advances. Fundingemployee advances creates an excessive burden on the payroll andtreasury teams, both from an operational and funding perspective.Be sure to structure your program so that the vendor funds allemployee advances.
  • Tax withholdings: Your payroll team does notwant to file daily tax withholding. To avoid that, select a dailypay vendor who funds all employee advances so that the company isnot funding any advances and triggering tax withholdingrequirements.
  • Compliance: Your payroll team does not want tobe “cutting edge” as it relates to a novel interpretation of statewage-deduction laws. Make sure that the daily pay program isdesigned so that the employee still receives 100 percent ofhis or her net wages on payday, so there are no unintentional wagedeductions committed by your company.

Jason Lee is founder and CEO of DailyPay.

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