Employers can remain competitive by helping their employees maximize each paycheck through innovative technologies and financial education resources.
Mark Coindreau
Director of Public Relations, Media, and Events Production Management, PayrollOrg
The paycheck is one of the most important interactions between a company and its employees — it’s the reason people come to work after all. How an employee is paid offers a wealth of opportunities for them to take home more each payday, lower their taxes, and even make their finances easier to manage. Savvy employers should take advantage of the latest technologies and trends available and provide financial education resources to make themselves more competitive with current and prospective employees.
Here are three things employers can do to help their employees maximize their paychecks.
Make wage access easy
Earned wage access (EWA) is the newest payment trend that employers should consider implementing. These programs, through which employees receive earned pay before their regularly scheduled payday, can help employees gain greater financial security by helping them better align their pay with the timing of expenses.
The desire for employees to receive financial help is high. In fact, a recent survey by PwC showed that 60% of employees are stressed about their finances, and 74% of employees want personal finance help. The latest “Getting Paid in America” survey by PayrollOrg found that 77% of America’s workers are living paycheck to paycheck.
Implementing a financial wellness benefit like an EWA program that provides employees with early access to their earned wages, along with other financial wellness tools, can be a big help to struggling employees while making the company a better place to work.
Employers should be careful to select an EWA provider that meets the needs of its employees. PayrollOrg offers a complimentary report for employers to help select an EWA provider.
Help employees boost their take-home pay
While many Americans look forward to a tax refund, a big check from Uncle Sam may be a signal that an employee is having more taxes withheld than necessary from every paycheck. Educating employees on how they can better match their payroll tax obligations with what they truly owe can give employees a boost in their take-home pay each paycheck.
The IRS has a helpful withholding estimator that can help guide employees on what adjustments they can make to their Form W-4 to lower the taxes withheld from their paychecks and give themselves an instant raise.
Help employees save on medical costs
Employer-sponsored benefits such as healthcare and dependent care flexible spending accounts (FSAs) can help employees save significantly on major expenses each year. The money an employee contributes to an FSA is not subject to payroll taxes, so the employee ends up paying less in taxes, which increases their take-home pay. Employees using healthcare FSAs save an average of 30% on medical expenses according to the Federal Flexible Spending Account Program. With healthcare and dependent care costs on the rise, this can be a great way to help employees save a significant amount of money.
Enhancing payroll and benefits offerings can help make an employer more attractive to current and prospective employees. To help employers educate their employees on how to make smart adjustments to how they’re paid, PayrollOrg offers the complimentary “Understanding Your Pay” ebook. This easy-to-understand guide helps employees better understand the basics of their pay and how to maximize their paychecks.
