Tuition Reimbursement

The importance of tuition reimbursement as an employee benefit can’t be ignored. In a recent State of the American Workplace survey report, Gallup found that 45% of Millennials say they would change their jobs for tuition reimbursement benefits, and 65% of HR decision-makers say that failing to attract and/or retain Millennial or Gen Z employees could have a negative impact on the business.

You are the HR manager for a medium-sized company that wants to implement such a program, and the CEO wants you to make recommendations for this plan. He has asked you to determine what the “ideal” tuition reimbursement program should look like—in other words, what are the key features and stipulations?

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Your initial posting should address the following questions:

What employees will be eligible under this plan? Will part-time employees be eligible? If so, how many hours per week must they work in order to maintain eligibility?
How long must the employee be employed by the company in order to be eligible for this program?
What programs of study will be eligible under the plan? For example, should an employee be allowed to seek a degree in any discipline or must it be job-related? How will you determine eligibility of a broad-based program of study like business administration?
What is the level of cost that the company will take on? Is there an annual cap on the benefit? (Keep in mind that the IRS allows only $5,250 per year to be written off by an employer for an employee’s education costs, so anything above that amount will result in additional tax expenses for the employer.)
Will the amount of tuition reimbursement be scaled according to grade requirements? For example, in some companies, a grade of “A” receives full reimbursement, a grade of “B” is reimbursed at 75%, a grade of “C” is reimbursed at 50%, and lower grades are not reimbursed at all. What will your plan specify?
Will you require an employee to remain on the job for a specific period of time after attaining his or her degree (sometimes known as “golden handcuffs)? If the employee leaves before the specified period of time, will s/he be responsible for paying back some portion of the tuition? If so, how much?

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