Subway, the popular sandwich franchise, does not currently offer DailyPay as a benefit for its employees. DailyPay is an app that allows employees to access their earned wages before payday. Instead of waiting the standard 1-2 weeks for a paycheck, DailyPay integrates with a company’s payroll system and lets employees withdraw their earned income whenever they need it. This provides more financial flexibility for hourly or gig workers who live paycheck to paycheck.
What is DailyPay?
DailyPay is a financial technology company that offers an app-based service to allow employees early access to their earned wages. Here’s how it works:
- DailyPay integrates with a company’s payroll system and timesheet data to determine how much an employee has earned so far in the pay period.
- Employees can use the DailyPay app to view their available earned income and instantly withdraw some or all of it to their linked bank account.
- DailyPay charges a small fee (around $1-3 per transaction) for this service.
- On payday, the employee receives the remainder of their paycheck after accounting for any early withdrawals via DailyPay.
For example, if an employee has worked 50 hours so far in a 2-week pay period, DailyPay would show they’ve earned about $750. The employee could then withdraw $200 ahead of payday to cover an unexpected expense, and receive the remaining $550 on the scheduled pay date. DailyPay is not a payday loan – it only provides access to wages already earned.
Who uses DailyPay?
DailyPay is currently used by over 1 million hourly and gig workers across a variety of industries. Some notable DailyPay partners include:
- Uber
- DoorDash
- Amazon
- Walmart
- Lowe’s
- Adecco
- Burger King franchisees
However, Subway has not yet announced a partnership with DailyPay. The sandwich chain relies heavily on hourly workers in its restaurants, the type of workforce that would benefit from an on-demand pay option. But Subway appears to be lagging behind some competitors in adopting this innovative payroll technology.
Why do employees use DailyPay?
For many hourly and gig workers living paycheck to paycheck, early wage access can provide much-needed financial flexibility between pay cycles. Here are some key reasons why employees use services like DailyPay:
- Avoid late fees or overdrafts – Being able to withdraw earnings before payday can help cover an unexpected expense and avoid costly fees.
- Manage cash flow – Workers can match income to expenses more closely rather than wait for a lump sum every 2 weeks.
- Save on predatory lending – Accessing earned wages can prevent workers from resorting to payday loans or high-interest credit cards.
- Build credit – DailyPay reports to credit bureaus, allowing responsible use to boost credit scores over time.
Essentially, the flexibility and convenience of being able to access earnings immediately removes pressure between pay cycles and can assist with overall financial health.
Does early wage access help or hurt workers?
There’s an open debate around whether on-demand pay services ultimately help or hurt hourly workers. Here are some arguments on both sides of the issue:
Potential benefits:
- More control and flexibility over personal finances
- Ability to cover emergency costs without borrowing
- Reduced stress from pay cycle fluctuations
- Possible credit score improvements
Potential downsides:
- Workers may overuse service and drain earnings too quickly
- Does not address underlying issues of low wages or income volatility
- Fees to access earnings reduce total pay
- Employers may use it in place of more meaningful benefits
Overall, early wage access provides workers more autonomy over their hard-earned money between paychecks. But some critics argue it masks deeper financial issues, does not adequately regulate how often earnings can be tapped, and places the onus entirely on the employee to manage cash flow effectively.
Should Subway offer DailyPay?
Here are some pros and cons for Subway to consider regarding whether to adopt DailyPay for its restaurant employees:
Potential benefits:
- Attract and retain workers in a tight labor market
- Provide more scheduling flexibility to employees
- Reduce absenteeism when employees can cover emergency costs
- Align with hourly workforce needs and expectations
Potential downsides:
- Administrative costs to integrate with payroll systems
- Pushback from franchise owners to offer added employee benefits
- May seem like an inferior alternative to wage increases or hourly pay guarantees
- Short-term solution that does not address systemic underemployment issues
Overall, offering an on-demand pay option could give Subway a competitive edge in recruiting, make scheduling easier with a flexible workforce, and demonstrate an understanding of its hourly employees’ financial needs. But some franchisees may resist the added costs, and workers may prefer systemic compensation reform over optional financial tools. Subway should conduct pilot programs and employee surveys to further evaluate if DailyPay would benefit its business model and workforce.
Case Studies of DailyPay Usage
Uber
Uber began offering DailyPay to its drivers in 2018. Uber cites that drivers who use DailyPay:
- Work 17% more hours per month on average
- Are 20% less likely to stop driving with Uber
This suggests DailyPay helps retain drivers and improves satisfaction by giving them quick access to earnings to cover personal costs between rides. For gig platforms like Uber built on flexible workforces, an innovation like DailyPay can be pivotal to maintaining worker loyalty.
Burger King
Some Burger King franchise owners have adopted DailyPay for their restaurant workers. One franchisee in Memphis, TN reported:
- 10-15% increase in job applications after promoting DailyPay
- 65% of employees registered for DailyPay after 3 months
- Higher retention rate for new hires who use DailyPay
For hourly fast food workers, DailyPay allowed them to adapt better to inconsistent schedules and variable commuting/child care expenses between paychecks. This franchise owner was able to attract and retain workers better with the DailyPay perk.
Implementing an Early Wage Access Program
Here are some best practices for employers looking to implement an on-demand pay program like DailyPay:
- Research provider options and technology integrations
- Analyze costs versus projected benefits
- Develop employee education materials
- Train payroll/HR staff on new processes
- Consider piloting with select departments first
- Evaluate usage rates and satisfaction after launch
- Use feedback to refine the program and expansion
Key factors for success include seamless technical integration, employee awareness of how the program works, and tracking ROI through metrics like turnover, recruitment costs, and absenteeism. While potentially costly upfront, on-demand pay can provide a long-term workforce investment.
Frequently Asked Questions
Does Subway currently offer DailyPay?
No, Subway does not currently offer DailyPay to its restaurant employees and has not announced plans to do so. The sandwich franchise does not seem to have an on-demand pay program for workers at this time.
How does DailyPay benefit workers?
DailyPay allows employees to access earnings instantly before payday, providing more flexibility to manage expenses and avoid debt traps. It can help cover emergency costs, smooth volatile income, and prevent overdrafts.
Are there fees to use DailyPay?
Yes, DailyPay charges fees in order to provide its service, typically $1-3 per transaction. These fees are deducted from the employee’s bank account whenever they withdraw earnings early through DailyPay.
Can DailyPay be mandatory for employees?
No, DailyPay and services like it are entirely optional for employees. Employers cannot mandate that workers must use DailyPay or withdraw earnings before payday. Usage is voluntary based on each employee’s preferences.
How does DailyPay integrate with payroll?
DailyPay integrates via API with a company’s payroll platform to access up-to-date earnings data per employee. This allows DailyPay to instantly reflect hours worked and determine available earnings between pay cycles.
Conclusion
In summary, Subway does not currently offer DailyPay or any other form of on-demand pay access for its restaurant employees. Adoption of an earned wage program could potentially benefit Subway’s hourly workforce and improve recruitment and retention. But costs, technical integration, and franchisee cooperation would need to be weighed against the benefits. Ultimately, Subway will need to evaluate whether innovative financial tools like DailyPay fit into its business model and can help to differentiate its employer brand in a competitive hiring market.