Emerge General Information
Financial Wellness General Questions
Emerge Legal Questions
Emerge General Information
Who will explain the Emerge benefit to employees? Our marketing materials will explain the new wellness benefit and direct employers to our easy online Enrollment. Employee enrollment includes a personalized financial assessment tool and customized financial wellness plan.
How much work is issuing loans for HR? We feature an automatic setup with low human resources or benefits manager maintenance. 100% paperless solution on Emerge website; we handle all customer service and processing of emergency funds, loan repayments and reporting to credit bureaus.
Does the employer assume any responsibility for loans, for instance if a borrower leaves the company? With Emerge, the employer assumes no liability, ever. Our financial partners assume all liability for loans, even for terminated employees.
How will I know if my employees are using this program? Emerge provides your company with utilization reports at no extra cost.
Why offer loans through the workplace? Employers have an interest in strengthening the financial wellness of their employees—small dollar lenders do not. Workers depend on employers for guidance and options when it comes to their healthcare, and are increasingly looking to their employers for guidance and direction with their household finances.
How can I learn more about Emerge financial wellness? Sign up for a free, 15-minute webinar today for more details on the Emerge Financial Wellness benefit with a demonstration of our best-in-class benefit engagement platform.
Financial Wellness General Questions
How many of my employees are impacted on the job by financial stress issues? 81% of all employees say financial concerns have impacted their work attendance and productivity. (Statistics: CNN report)
Is there any evidence that employees want financial wellness benefits offered in the workplace? Yes. 52% of surveyed employees report being interested in receiving financial advice and guidance through the workplace. And employers are responding by offering this low-cost, high-utilization benefit. Surveyed employers offering wellness programs increased to 61% in 2009. (Statistics: CNN Report)
What are some of the physical tolls of financial stress? In addition to insomnia, those who report high levels of financial stress suffer from a range of stress-related illnesses including ulcers, migraines, back pain, anxiety, depression, and heart attacks. A recent New York Times article also comments on the potential consequences of financial stress, stating, others may turn to behaviors like gambling, alcohol or drug use. Often, one symptom can lead to another — anxiety can lead to sleeplessness, which can cause greater stress and so on. (Statistics: Corporate Wellness Magazine, NYT)
How does the link between financial and physical health affect my business? To start, 70-90% of all doctor visits are stress related, and that adds up for your company. Additionally, on any given day 1,000,000 employees are on sick leave as a result of stress related issues. One major way employee financial stress affects the bottom line at your workplace is through employees' overall health. (Statistics: "Employee Financial Stress is Costing Your Company a Bundle - And You Can Stop It Now")
What is the problem with financially stressed workers? 34% of workers under financial strain say having enough money to meet their current expenses is their biggest financial challenge, and 28% say they are not earning enough money at their current jobs. And, 71% of workers under financial strain expect their households’ financial conditions to remain the same or get worse in the next six months, leaving them in a long-term position of living paycheck to paycheck. Emerge coaching on budgeting and financial education plans can help these workers get in control of their financial situation. Nearly 6 in 10 (59%) of these workers don’t have a financial plan for dealing with unexpected life challenges or events. Emergency funds from Emerge can fill those gaps, replacing paycheck advance and 401k loan requests. (Statistics: 2011 Aflac Workforces Report)
How much does high employee financial stress cost the employer? Employee financial stress costs more than $400 annually per employee. (Statistics: In Charge Foundation report)
How can financial education change my workplace? Emerge offers its own financial education program that focuses on good spending practices. In a recent study, researchers found financial education programs have the potential to lower financial stress, reduce absenteeism, increase productivity and lead to a more loyal workforce. (Statistics: Isles)
What are the potential consequences of not addressing growing financial stress? Financial wellness programs are highly affordable but losing an employee to financial stress can cost you a bundle. It costs an employer between $3,000 and $13,000 to replace the average employee. (Statistics: Isles)
How does an employee's overall well-being affect the day-to-day for the company? A recent US study found that the average sick day costs a business approximately $348 in lost productivity. This study also concluded that a workforce with higher levels of well-being got sick less often, effectively saving businesses money. (Statistics: Gallup Management Journal)
How much time can financial problems take out of an employee’s workday? According to a recent study, stressed-out employees spend an average of about 20 hours a month dealing with their financial problems. This is too much time wasted for a problem that can be managed. Emerge can help employees reclaim that time. (Statistics: Fox Business)
What real effects does employee financial wellness have on employer Human Resources? Low levels of employee financial wellness have harmful impacts not only on employees, but on HR practices as well (Statistics: American Psychological Association survey):
Staffing and Hiring.
When employees who are eligible to retire and wish to do so cannot because of poor financial decision making, hiring opportunities will decrease. Data indicate that the financial knowledge of high school and college students is declining. When hiring young adults, the employer is increasing the portion of employees who will be “at risk” and cause harm to themselves and their employer.
When employees who are eligible to retire and wish to do so cannot because of poor financial decision making, fewer promotional opportunities are available. Fewer promotional opportunities frustrate employees seeking and deserving promotion and may increase turnover of top-performing employees.
Compensation and benefits.
Employees who are distressed by financial problems are less satisfied with their pay and benefits. They make poor decisions about their pay and benefits and under-utilize programs such as 401(k) plans and flexible spending accounts. Under-utilization of FSAs increased employers’ FICA expenses. Employees who do not manage their finances well create payroll expenses for wage garnishments and 401(k) loans. When employees who are eligible to retire and wish to do so cannot because of poor financial decision making, the average wage and benefits costs of the employees are higher. This is due to the fact that there are a greater number of high wage earners than low wage earners at each job level in the organization.
Mergers and Acquisitions.
The cost of merging or acquiring an organization with low levels of financial wellness is greater than the acquirers know. Financial wellness is not considered in due diligence calculations.
When employees who are eligible to retire and wish to do so cannot because of poor financial decision making, there are fewer openings for new leadership talent. The organization runs a greater risk of turnover among the leadership talent that cannot advance in their careers.
Employees who are distressed by financial problems, or are frustrated about limited promotional opportunities or by an inability to retire will perform less well and are less engaged in the business than if those conditions did not exist. These performance problems reduce business productivity.
Emerge Legal Questions
Can an employer market the Emerge workplace loan and financial education program to its employees as an employee benefit without being held potentially liable for any lending risk? Even if there is no money provided by the employer? The Emerge Program can be treated as any other benefit offered by the employer. For example, an employer can provide descriptions of the Emerge Program in its Employee Handbook or on its benefits page on its internal website. The employer should describe that while the company offers the benefit, the employee is fully responsible for all handling of the loan—as would be the case with any other banking product.
Can the employer provide a link to the Emerge website from its website/intranet without seeming to endorse the product offering? Is this different for nonprofit or public-sector employers? So long as the benefit offering for the Emerge program is properly explained to the employee – either on the employer website/intranet or in the Employee Handbook – the employer may provide a link on its internal website. This is the same for all types of employers, including nonprofit and public-sector employers.
Is Emerge subject to ERISA? The Emerge Program should not constitute an “employee welfare benefit plan” or “welfare plan” as defined in ERISA and should not be subject to ERISA or the ERISA reporting requirements. The provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”) generally apply to any “employee welfare benefit plan,” “pension plan,” or other “employee benefit plan” maintained by certain employers. These include plans that provide medical, sickness, accident, disability, death or unemployment, vacation benefits, apprenticeship or other training benefits, day-care centers, scholarship funds, or prepaid legal services. 2 U.S.C. § 1002(1). ERISA also covers certain plans, funds or programs providing for holiday, severance or similar benefits, and financial assistance for employee housing, regardless of whether they are funded through a trust. 29 C.F.R. § 2510.3-1(a)(3); Scott v. Gulf Oil Corp., 754 F.2d 1499, 1502-3 (9th Cir. 1985).
Is there any data that the employer has in its employee data file or personnel record that cannot be released with written consent by the employee to Emerge for the purposes of underwriting a loan? The California Constitution imposes broad limitations on the unilateral disclosure of an employee’s private information by his or her employer. See CAL. CONST., art. I, § 1. However, any limitations on disclosure of personal information can be waived through the express written consent of both the individual and the business. CAL. CIV. CODE § 1799.1(a). In other words, both the employer and employee must provide written consent to Emerge in disclosing the contents of any employee data file or personnel record.
Can employers provide Emerge with information pertaining to an employee’s resignation or last pay period so that Emerge can directly contact any delinquent borrowers? A simple, short statement that merely reports a separation date (without disclosing the reason for separation) is information that an employer can provide to Emerge without raising any privacy concerns.