As the non-employee workforce grows, demands for quicker access to pay push companies to find solutions

The number of non-employee workers – contingent workers, independent contractors, freelancers, gig workers and day workers – continues to rise, with experts attributing it, in part, to the “Great Resignation” that emerged during the Covid-19 pandemic. A recent survey from Edelman Intelligence and Upwork found that 59 million US workers, or 36% of the entire workforce, freelanced in 2021. And hiring managers expect to use even more freelance workers over the next two years.

Workers are no longer willing to accept any job, but are looking for roles that better suit their skill sets, values and lifestyles. And with so many jobs available (the Bureau of Labor Statistics (BLS) reported almost 11 million at the end of 2021), workers can be selective. Recent BLS data also found that workers are demanding that organizations address various components of worker experience like a more positive culture; holding values and purpose closer to their own; flexible working arrangements; a focus on diversity, equity and inclusion; and sometimes, even the basic desire for better, faster pay.

While there is much public conversation about what makes a better worker experience, one often-overlooked component, especially for non-employee workers, is getting paid in full and on time. The Covid-19 pandemic created even greater financial challenges; waiting the traditional two or four weeks for a paycheck often resulted in financial hardship.

In New York state, the problem motivated state legislators Andrew Gounardes and Harry Bronson to introduce the “Freelance Isn’t Free” bill to provide legal protections for freelancers with regard to pay. Following the lead of New York City, where a similar act was put in place five years ago, the legislation would require contracts and timely payments, among other benefits.

Non-employees want reliable, fast access to pay

Contingent workers across industries face financial hardships, just like regular W-2 employees, but often have to wait much longer to receive their pay – or they never receive it at all. In some cases, they receive monthly paychecks, making the last few days, or even a couple of weeks, before their next check a struggle.

Recent research from global consulting firm Ernst & Young shows that 72% of respondents were not able to pay a bill or meet a necessary expense between pay periods. The worry and increased stress was not only found in lower-income groups. Thirty percent of those making more than $100,000 annually experienced inability to meet financial obligations.

And with the advent of technology that touches many functions of our daily lives, workers now believe companies should provide more flexible pay options. A recent poll by Ceridian, a global human capital management services provider, found that 83% of workers believe they should have access to their pay at the end of a shift or work day.

Workforce management technology offers a solution

Light industrial, warehouses and other shift-based businesses are hiring more non-employee workers, making the need for on-demand pay even more urgent. And the extended workforce world is taking notice.

Ceridian recently launched Dayforce Wallet, a pay solution that gives workers on-demand access to their net pay through a mobile app when they need it and with no fees.

To bring the solution to the contingent workforce segment, PRO Unlimited, an integrated workforce management platform provider, has partnered with Ceridian to offer Dayforce Wallet; specifically through its Worker Experience solution. PRO Unlimited solves the flexible workforce needs of Fortune 1000 companies through data, talent intelligence, and managed services.

“The rapid expansion of the non-employee workforce coupled with the pandemic has accelerated how we must embrace digital transactions,” said Kevin Akeroyd, CEO of PRO Unlimited. “Workers expect a seamless, complete process that includes access to assignments, payments, and other financial documents from their mobile devices, which has prompted organizations to rethink their strategies and tools.”

And since 78% of the respondents in Ceridian’s poll said that free access to on-demand pay would increase their loyalty to an employer, providing tools like Dayforce Wallet (and other technologies in the category that are sure to be developed) has the potential to improve the performance and staying power of a company’s contingent workforce.

Ernst & Young’s survey supports this notion. The results found that worker distraction, absenteeism and reduced performance – and ultimately a 20% turnover rate – stem from financial stress. Removing that issue by offering on-demand pay has the potential to reduce turnover and financial impact, the survey added, saving US and UK companies a combined $300 billion annually.

This Brand Studio post was written with PRO Unlimited.