Raising $500 million emergency cash after just because they lost access to $300 million doesn’t quite add up.
This feels more like another funding round that was maybe pushed forward due to SVB concerns.
I’m no lawyer, but when Rippling started emailing me “hey, your payroll money is actually with SVB and we need you to contact your bank to try and reverse the payment,” my first thought was “isn’t it your job to make sure my payroll safely reaches my employees?”
I imagine they had to make sure all their customers were made whole and quickly even if SVB money wasn’t able to be recovered, and then decided it would be a good plan to always have more than enough cash to cover the payroll they’re holding for customers.
I think they did it via some kind of one off point process since I didn’t get an email and the Rippling web app didn’t show me as paid until midday on the 16th. Normally those occur at the same time I see the direct deposit hit.
Very unhappy with Rippling here and will advocate my company change processors. They initially acted as if they would cut over to JPMorgan and be fully up on Monday, but as time goes on it becomes clear they had to do a lot more than just change the account they staged payroll through.
They also failed to have a secondary banking relationship in place, credit revolvers or other contingencies that let them handle this in house, etc. In 30 years of getting paid and working through times like 2008 when major disruption to banking and credit availability occurred, to me Rippling stands alone as the only company that failed to run payroll on time and it took a single point of failure to make them fall.
Being told that JPMorgan is taking over the deposit, and knowing your payroll payment automations are going to work a different things. I imagine they had to test, and likely rewrite them. Wiring $300M of pay checks as a “we’ll do it live” scenario seems unwise.
You’ve every right to be upset. But how long do you think it would take another payroll provider to recover after losing all funds due to their bank going under? 2-3 days seems pretty impressive.
No payroll processor could have made payroll on time in this situation. If you overnight a letter from SF to NYC and the plane crashes on landing, the replacement letter is definitely going to be late.
To put it another way, I have been paid via direct deposit for over 30 years and multiple fiscal crises. There is only one company that ever failed to get full payroll out on time
It might be fair to say that Rippling failed by choosing the wrong bank, but that’s a very different argument than saying that Rippling didn’t have a good backup plan. If all you’re going by is that you’ve always gotten paid (vs say knowing who your payment processor banked with and what their Plan B in case of bank failure was), for all you know your previous payment processor had no backup plan either!
With that said, I am sure a lot of executive teams are reconsidering usage of payroll processors who aren't ADP for the same reason a lot of folks have moved funds to JPM. Flight to security and all that. It's not an illogical reaction to have from your end.