When considering benefits packages to offer new employees, it may pay to consider sending new hires to school on the company's dime. Seeking to further their skills and knowledge, professionals today are eager to take college courses, and they may react favorably to organizations that help them pay the bills.
At first, it may seem counterintuitive to offer tuition payments as an employee perk. After all, there is a chance that workers will use their newfound education to seek other positions outside of the company. However, they may also put those new skills toward increased performance within their present roles, or become great candidates for promotion.
In the end, the goodwill and loyalty generated by a reimbursement program may outweigh worries about losing employees to other companies. Coupled with the financial benefits of spending on tuition instead of other kinds of perks, this bond between employer and employee may be just what your hiring and retention efforts need.
Embracing an increasingly popular idea
According to The Balance, major companies are committing to tuition reimbursement, listing several of the motivating factors that have led human resources departments to this particular perk. For instance, spending on employee tuition is tax deductible. Companies may apply for a deduction of up to $5,250 for each worker they put through college. This tax benefit helps businesses justify the bottom-line hit associated with tuition payments.
"Since there is no one way to offer educational subsidies, plans can be flexible."
Furthermore, businesses are offsetting the risk of losing workers by attaching conditions to their funding. Some businesses require employees to not leave for a set amount of time after the conclusion of subsidized classes. This ensures the skills acquired will be put to use at that company. Since there is no one way to offer educational subsidies, plans can be flexible. Some organizations only support chosen colleges, while others focus their reimbursements on particular courses of study.
The Balance listed a few of the major companies that have embraced tuition as a perk. AT&T approves employees on a case-by-case basis. Bank of America covers up to $5,250 per worker per year, echoing the maximum possible tax deduction amount. Home Depot offers different levels of educational support for various tiers of employees, starting with part-time workers and including hourly and salaried employees as well.
Paying in full
According to The Wall Street Journal, some large organizations are going beyond partial tuition and offering more complete packages, sometimes including ancillary costs such as textbooks and other supplies. Companies are also becoming more proactive about paying, giving employees funds right away instead of making them wait for reimbursement. College costs are high, so a lack of up-front spending by organizations could be enough to discourage employees from using a tuition perk.
Disney, Discover and other employers believe these large-scale tuition packages are worthwhile because they are more affordable than the cost associated with hiring new high-skill employees, The Wall Street Journal reported. This is one of the calculations you'll have to make when considering the cost of using education as a perk. When your organization is filling roles that depend upon rare abilities, you may find it more affordable to give in-demand benefits to those workers than to risk losing them and reopen the job search.
Suiting employee needs
Becoming a top employer, finding great talent and holding onto the best employees, means adjusting HR practices to suit the preferences and needs of workers today. When research reveals your workforce is interested in pursuing higher education, you may benefit from funding college courses. The many advantages of such programs - from improved loyalty to new skills among employees and even tax breaks - make them easier to justify to top management. The only question is whether your company is in a position to add to your perk lineup.