Wage advance is a form of loan even though it doesn’t seem like it at first. When an employee asks for a wage advance, he is technically asking for money that he has not earned yet. Hence, it is considered a form of a loan.
There is absolutely nothing wrong with wage advances. But sometimes it can hurt a company especially too many employees ask for a wage advance all at once. This can happen to small businesses and startups. Wage advances are inevitable. Sometimes, things or emergencies come up wherein an employee will need to ask for a wage advance. But there is a way for you to combat wage advance as a company. In this article, we are going to tackle methods that are way better than giving people wage advance.
The first alternative would be to give employees better pay. If you can give them that, they’ll have enough money for their needs and wants + savings. With that, they would have sufficient money to spend for emergencies when need be. And they won’t have to ask for a wage advance.
Even though most small businesses may be avoidant when it comes to higher salaries due to the short-term consequences, it is worth considering.
It may be expensive in the short term but this decision will most definitely benefit you in the long haul. This is because your employees will be more prepared to spend for unexpected expenses.
Looking at the long-term outcomes is usually a wise decision when it comes to running employees.
But if this isn’t something you can afford, we have another suggestion – why not aim for cash incentives?
Cash incentives are the least expensive compared to giving employees a higher salary. Multikrd offers employee rewards of multiple varieties. On top of that, they will also receive salary cashback. All that for you only a pretty affordable price.
Give Employees Higher-Quality Living
At first glance, this might seem like an impossible task. It might even seem like the kind of task that is out of your bound as an employer.
But you’ll soon see that giving your employees higher-quality living is one of the keys to a successful business.
This is due to 2 reasons:
- Happy employees are more inclined to become good employees
- If your employees have a good-quality life, it lessens the need for wage advance that could potentially disarm your business at some point
But how does one improve the lives of one’s employees?
It may have been difficult at some point…but not anymore. We’ve mentioned it earlier. You can improve the lives of your employees through Multikrd’s rewards system.
The great thing about this rewards system is that your employees can exchange their credits for almost any kind of reward or incentive.
The variety of the incentives depends on you and what you think would best benefit your business. Your employees could have a free meal voucher, free travel destination, and many more.
Good Work-Life Balance
This is something you’re going to like because it does not include spending more money to make your employees’ lives better.
One more thing that will make your salary system more effective is to give people a good work-life balance.
If you want to avoid wage advance as much as you can, you need to plan your business while looking at long-term outcomes.
By providing people with a good work-life balance, your employees will have time for themselves. They will be able to take good care of themselves. What this means is that they don’t have to ask for a wage advance due to certain illnesses.
They can manage their lives better due to their free time. Hence, they are more efficient in managing their finances. They won’t have to be surprised with unnecessary expenses that could lead to the need for a wage advance.
Since they don’t have to overwork themselves in the office, they will have time to work on their side businesses so that they have a healthy financial life. Hence, your employees will have a good life and then the overall need for a wage advance would decrease significantly.
How can one ensure that their employees have a good work-life balance? Here are some suggestions:
- Don’t be afraid to hire people
There will come a time when you will gain a bigger consumer base or you start to scale your company. And when this happens, you will most definitely need to hire new people. This would be better than having to require your existing employees to do overtime for you just so the work demand can be fulfilled. It might sound like an investment but people are always an investment that is worth it in any business.
- Set Priorities
You have to set priorities along with the respective deadlines. By doing so, you can assign only a few tasks to employees each day. Since everything has been scheduled well, employees will have the luxury of not having to work too much for the day while the deadlines are still being met.
It will give employees peace of mind at work. Peace of mind can greatly improve mental health issues – and as we know these mental health issues are typically the main cause of emergencies that requires your people to ask for a wage advance.
If you’re a generous businessman, it may not bother you all that much to give employees a wage advance whenever they need it.
But you should be aware that certain risks are tied to doing so especially if you are a small business. A good way to lessen the need for a wage advance would be to increase the pay of employees. But if that’s not possible for you, we have an even better suggestion that won’t just benefit you in terms of lessening the need for wage advance but it can also be advantageous in terms of retaining your top talents and making sure that productivity is a top high within the office – it’s through giving employee rewards through Multikrd.