Other employers provide advance payment of educational expenses; some provide half of the reimbursement up front and the rest on satisfactory completion of the course. Some employers link educational assistance to continued employment and require pay back of educational assistance if the employee voluntarily leaves the organization within a specified time period, such as a year.
Variations abound; however, employers must be aware that all choices are not equal in terms of tax consequences, administrative costs and perceived value to prospective hires and current employees. HR's role in designing and managing an educational assistance benefit program is multifaceted. The most basic role an HR professional plays is presenting the business case for an educational assistance program; HR should not assume the CEO is aware of the cost-effectiveness of such programs.
If senior leaders support the idea of offering some form of educational assistance benefit, HR must design a benefits package that is best suited for the organization with input from outside experts. Feedback from senior leaders must be incorporated to adjust the plan as needed. Employers have numerous factors to consider in developing an educational assistance benefit program.
If an educational benefit program already exists, HR professionals should continuously assess its effectiveness and look for improvements. HR must make sure the program meets the organization's strategic objectives. An employee who has completed an approved course of additional learning will expect career development opportunities in the organization and enhanced marketability outside the organization.
The employer should be poised to reap the reward of its investment through career pathing. HR professionals have many options when creating an educational assistance program. Interdependent factors the employer must consider in setting up a particular program include the following:. Education Benefits Present a Learning Opportunity. Communic ation. Effective communication of an organization's benefits programs is critical to achieve strategic objectives. Although employees and potential hires may easily understand relative levels of monetary compensation, understanding the advantage of benefits takes more effort on the part of HR professionals, employees and potential hires.
Benefits tend to be valued on an individual basis; if an employee does not use the particular benefit, he or she may not see its value.
The legal issues concerning the establishment and maintenance of an educational assistance program are complex. Employers should not attempt to create an educational benefit plan without up-to-date expert advice.
Tax laws are in constant flux, so employers need to be up-to-date about any information concerning the application of tax laws before designing and implementing an educational assistance program. This toolkit does not provide legal or tax advice. However, it does discuss some basic issues to help readers in their discussions with competent experts in the field of educational assistance programs.
The exclusion applies whether or not the courses taken are related to the employee's current job responsibilities or are part of a degree program. For example, an employer may prefer to provide educational assistance benefits only to its highly compensated employees. Educational expenses are a deductible expense for an employee if the education is directly related to the employee's current job responsibilities.
On top of limiting the outright spending on education fees, there are also government grants and assistance programs that can lower the overall costs your company takes on.
For example, the Ontario job grant program helps companies pay for needed training of employees. The CRA also offers education expenses tax deductions to help in this. Learn more about the eligibility of tax deductions on education fees. The government sees tuition tax credits and education funding in Canada as a necessary way to improve occupational skills, so all parties involved benefit. Employees that see their employers caring for them and offering education funding in Canada could potentially keep them loyal and hard working for years to come.
If they know you as the business owner are backing their education and learning, they see that you care and are more likely to stay with the company as you both grow. Since education reimbursement is a type of investment on the employers part, they can stipulate goals that must be reached for the employees who apply.
A tuition reimbursement policy will state the minimum grade or GPA the employee must obtain in order to have their fees covered by the employer. The policy can also set a specific length of time for the employee to stay at the company while the education is ongoing and after completion. The extra perks you offer can make a difference in attracting and keeping employees. Investing in educational opportunities keeps your employees current in the field and supports employee satisfaction.
Why not try using QuickBooks Online to help keep your finances in order , so you have the cost to cover education funding in Canada for your workforce.
Further, a new report from Bright Horizons, a major tuition assistance support organization, highlights the popularity of these programs among employees, with half of survey respondents ranking tuition support as one of the best benefits provided by their company, and three-quarters indicating the provision of such support would make them more likely to stay on the job. These questions are relevant for employers just starting out in considering a program, or for companies considering a shift in their strategy.
Each of these objectives has a programmatic implication. A general tuition reimbursement model will likely only superficially serve objective 1. There is a growing trend among large employers in using intermediaries like Guild Education, Bright Horizons, and InStride to administer tuition-support programs.
Each of these organizations offers something different. In-house administration may also be an effective approach. Having a goal in mind at the outset is helpful for planning. If a company wants to ease into a program or cap utilization at a certain spend or number of participants, that decision should lead to fundamentally different design decisions. One thing that surprised me most as we got into this space was how little data a typical company tracks about its education programs.
Even the basics—turnover costs, promotion rates, and employee participant data—can be the foundation for a basic ROI calculation. We have found over and over that programs with low utilization and little awareness among employees are absent from the day-to-day conversation, have little leadership support, and are generally mentioned only in the employee handbook.
Automation is poised to eliminate many jobs and create new ones. As a result, education, particularly in the fast-changing tech industry, is moving toward bite-sized offerings. Workers will see the lines blur between education benefits and corporate training. But the current landscape favors supplementing that benefit with other education assistance, such as certification methods, nondegree online learning and learner-driven programs that give employees a budget they can spend on a variety of approved educational opportunities.
A number of states have set a goal of 60 percent of adults having a two-year or four-year degree by , but the U. In , nearly 48 percent of toyear-olds in the U. Schools and employers are experimenting with educational alternatives that are less expensive, take less time to complete and focus on job-related skills. Students in these programs often work on real-world projects that help the company that underwrote the course.
In , Google began offering scholarships to the IT management program it developed with Coursera, hoping to find potential employees. But some employers still incorporate education and training during the workweek, particularly where many employees are unfamiliar with a traditional college or online learning setting. In a Gallup poll, 59 percent of blue-collar workers said they would look to an employer for retraining if they lost their jobs due to technology, compared with 41 percent of white-collar workers, who were more comfortable relying on college courses.
Infographics on mixing chemicals help to bridge language barriers. Employees also have short, standing meetings in which supervisors review safety requirements. Some of the five-minute lessons cover English vocabulary, such as common phrases employees may need if they encounter an office tenant.
USSI also offers to help workers learn English more thoroughly, bringing in trainers, providing Rosetta Stone courses, and partnering with local schools. In addition, USSI gives supervisors quick lessons in soft skills, such as handling difficult behavior. The No. The program trains employees on situational leadership, behavioral assessments and organizational culture. The first round of Cultivate U. Abbott Laboratories has received IRS approval for an innovative plan to resolve the tax issue of student-loan subsidies.
A few years ago, Abbott reviewed its benefits offerings in the largest countries where it operates. Many U. This plan allows employees to address their student-loan debt, which they viewed as their top priority, while still getting them started on saving for retirement.
A private letter ruling applies only to the employer that requested it.
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