Offering the right benefits can give your company a competitive advantage in terms of recruiting and retention. However, you need to be sure that the benefits you offer are financially feasible and have a favorable ROI. One trend that’s catching on is reimbursing employees for continuing education. Does it make sense for your business, and will it add to your bottom line?
Develop Your Employees
As an employer, it’s only natural to be invested in your staff. Their personal success inevitably contributes to the success and growth of your company. Reimbursing employees for continuing education improves their knowledge and develops their skills, which they can then utilize to become better employees. This can translate into improved performance, increased output and more.
It Can Increase Loyalty and Morale
Offering this benefit shows your team members that you want to see them flourish. You don’t merely view them as cogs in the machine, but you genuinely want them to thrive. This can quickly breed loyalty and raise morale. In turn, employees are likely to put forth a greater effort and go the extra mile for you.
It’s Tax Deductible
You should also know that you can deduct this benefit as a business expense. According to BizFilings, “Educational assistance programs allow employers to provide employees with educational assistance of up to $5,250 annually excluded from an employee’s income. Employers can claim a business deduction for educational employee benefits paid and are not required to pay FICA or FUTA payroll taxes for benefits provided under the program.”
Tuition costs can be expensive. According to the College Board, “The average cost of tuition and fees for the 2016–2017 school year was $33,480 at private colleges, $9,650 for state residents at public colleges, and $24,930 for out-of-state residents attending public universities.”
Although you may not pay an employee’s entire tuition, this can still be a major expense, especially if you’re offering it to multiple employees. If you’re a new company or operating on a minimal budget, it may simply not be feasible.
It’s not always easy to juggle higher education with a full-time or even part-time career. Combine this with raising children and other obligations and it can create issues with scheduling. Not to mention an employee’s performance can diminish if they’re fatigued with a full plate.
Employees May Look for Greener Pastures
There’s also the potential for this benefit to backfire. In some cases, employees will develop their skills, improve their education and ultimately leave for a higher paying job. In this scenario, all of the money you funneled into reimbursing their continuing education will be futile and you’re wasting resources.
It’s good to explore different benefits to offer your employees. Reimbursing employees for continuing education is becoming more and more popular and makes sense in certain situations. Carefully weighing the pros and cons should help you determine if it makes sense for your company so that you can make an informed decision.