‘Instant Pay’ Is New Perk for Some Food Workers
The move to pay staff when they clock out aims to attract and keep cooks and cashiers.
May 21, 2019
ALEXANDRIA, Va. – Store employees for Church’s Chicken, Checkers and Pizza Hut soon will be able to receive same-day or next-day paychecks as restaurant chains strive to attract and keep kitchen staff, reports Bloomberg.com.
Starting in June, eight Church’s Chicken outlets will offer employees half of their earned pay the day after their shift as a test to determine whether the 50% is enough for workers. If successful, the plan is to roll out the perk more widely. It’s not a loan, and there are no fees.
“It will give the employee the chance to get spending money quicker,” said Joe Christina, CEO, Church’s. “Some people just can’t wait two weeks to get paid.”
With the U.S. jobless rate at a 49-year low, the foodservice industry, as well as other businesses, is hurting, and simply raising wages isn’t always enough to keep workers. That’s why many fast-food operators are throwing hiring parties, recruiting through text messages and giving signing bonuses. McDonald’s is heavily targeting seniors to fill vacancies.
Foodservice is being squeezed as fewer teens enter the workforce and higher minimum wages go into effect around the U.S. In addition, higher pay for lower-skilled workers at big companies, such as Amazon.com, Target and Walmart, makes restaurants compete for talent.
Venture capital-funded Instant Financial works with Bloomin’ Brands Inc., the parent of Outback Steakhouse, and recently added Checkers & Rally’s Restaurants as customers. Steve Barha, CEO of Instant Financial, said that the current tight labor market has made instant pay “almost a requirement” for the dining industry.
On average, restaurant employees take out $28 with his company’s service after working, Barha said. Instant Financial doesn’t take fees from workers but rather makes money by charging the employer for the service.
Most working adults are living paycheck to paycheck, according to a recent survey conducted by NORC, the nonpartisan research organization at the University of Chicago. According to the study, 51% of Americans would need to dip into savings if they missed more than one paycheck.
That’s why Pizza Hut franchisee Erik Bittner is considering whether to mention the perk in his recruitment ads for delivery drivers as he competes for their services with Uber and Lyft. He added the benefit in March through the Branch Messenger Inc. mobile app.
“The expectation in the future from employees is going to be [that] they want their pay now,” said Bittner, who owns 12 Pizza Huts in Pennsylvania.
