By BLR Founder and CEO Bob Brady
HR Daily Advisor readers react to suggestions that employee tuition reimbursement money could be better spent elsewhere.
Two weeks ago, I “mourned” the fact that “nothing is sacred these days. Not motherhood. Not apple pie. Not even tuition reimbursement.”
The “sacrilege” in that last category came by way of an article by B-school Professor Dave Ulrich in Workplace Management.
Ulrich’s point was that tuition reimbursement (TR) programs were wasted money in many companies. The funds go to very few individuals, who often then take their shiny new, paid-for education and go elsewhere. Or if they stay and don’t get an immediate raise or promotion, they then become educated disgruntled employees. While Ulrich proposed more ROI accountability from the programs, other experts suggest simply dumping them and using the money for more broad-based benefits targeted at more of the workforce.
I said that I’d seen mixed results from BLR’s own TR program. Yes, we have had talent leave but we’ve also seen others become more productive and loyal. In the end, I suggested we stop counting the money and just look at it as a right thing to do.
As usual, you filled my in-box with e-mailed reactions, and if Ulrich is reading today’s Advisor, he’s going to feel mighty lonely. Judging by the mail, you are overwhelmingly in favor of TR programs, though for different reasons.
Also as usual, we’ll refrain from identifying respondents by name, and just label them A, B, C, etc. … with one well-known exception … George L. Lenard, editor of George’s Employment Blawg.
George gave a mixed review of TR programs, suggesting their effectiveness depended on how well the education fit the trainee’s job. “A tuition reimbursement program should either include a list of approved courses or require an educational plan describing how the course/degree would help the company,” George wrote.
Reader A showed how well this concept can work. “I completed [two degrees] through this benefit,” he wrote. “This education enabled me to rework our health benefit and save us $83,000 … way less than the cost of the benefit … and that is only the tip of the iceberg. There is not a day I spend on this job that both the company and I have not benefited from this education.”
Reader B also favored TR programs, even if they don’t exactly connect with the trainee’s present job. “People who attend college are more informed, better rounded, and have better critical thinking skills,” she wrote. “You could gain knowledge through seminars, but that is on company time. [These programs] are done on the trainee’s own time.”
Reader C saw things more in the “do the right thing” mode. “What is gained,” she noted, “is not always quantifiable in dollars,” while Reader D took a worldly view. “When U.S. workers are no longer competitive in the global marketplace, why are we thinking of cutting our investment in our employees?” he asked.
What about workers leaving? Readers had several thoughts:
Pay Only if They Stay
George Lenard suggested paying for the plans through student loans, reimbursed only if the trainee stays, a strategy others also urged, while Reader E suggested designing the program so the trainee “really owns the learning experience,” through “cost sharing, clear expectations, contractual commitments, etc.”
Others recommended not worrying about beneficiaries departing, as TR programs are so widespread that if you lose an employee you’ve paid to train, you’ll likely hire another trained at someone else’s expense. “It all comes out in the wash,” is how Reader F put it.
As for workers feeling peeved if not immediately rewarded for their new education, I said that since the employee still had the same job, the reward would come in the long run, but not now.
I was taken to task for this by Reader G, who wrote, “While doing the same job, they have grown in knowledge. When the company fails to acknowledge this, the employee feels cheated, and rightly so.” But Reader H agreed with me, saying that such peevishness is symptomatic of an “entitlement attitude. We tell them the training was to keep current with their present job,” he declared. “When it’s presented as ‘if you don’t keep current, we will need to replace you,’ their attitude changes,” he added.
Only one reader disagreed with the whole idea of TR, and his disagreement seemed mild. “I’d rather spread the benefit dollars elsewhere,” said Reader I, “but since it’s only cost $750 to $1,500 a year, there’d be little to spread. So we’ll likely keep the benefit for now.”
Finally, let me add a personal note to your feedback. I’m acutely aware of the value of providing educational opportunities for your people. I myself went to law school and did part of an MBA at night while I was working. I paid for it myself, but it made all the difference in my career. I don’t think I could have done what I’ve done without the training and knowledge I gained.
As always, thanks for your comments. You can still add your thoughts by using the Share Your Comments button below. We’ve also reproduced all your e-mails in their full form on our website and added a list of tuition-assistance-program resource links helpfully sent by one reader. Click here and this additional benefit can be yours … and you don’t even need to repay it!
An issue I keep running up against is that employees may not have enough money to attend degree training without the benefit. The company I work for does not have this benefit, although my previous employer did. Have the Tuition reimbursed if you maintain a C average, and you must remain with the comapny for 1 year after you take the course. All degrees must be employer approved.
Tuition reimbursement simply reinforces the importance of lifelong learning; if companies expect to compete, we must continually embrace the challenges of changing technology, competition, pricing pressures, etc. In short, companies must continually “learn.” Companies, however, do not learn, only the workers who make up the company are capable–and emphasizing learning through tuition reimbursement is one way to demonstrate the importance of continuous, incremental improvement. The US is currently facing a shortage of qualified workers–some statistics estimate a significant shortfall of the required 40% (of the overall job market) need of level 5 workers (ability to read and interpret empirical articles, write speeches and scope statements, etc.). The only way to fill the need is with post-secondary education. The benefits cannot be easily measured, but the long-term costs can.
My company has a tuition reimbursement program that I utilized for my undergraduate degree (with some of the features discussed above–pay if you don’t stay, gradepoint criteria for reimbursement, etc.). Upon completion of my undergrad, I spoke with my supervisor about a graduate degree. He flatly refused, telling me that, “I did not need it.” I finished my MBA anyway and paid for the entire program on my own. I am still here and the supervisor with the bad advice is long gone. The company has increased my compensation in line with my education–so they increased their overall fixed costs rather than paying a one-time chunk of money (something which I would have been very satisfied as now I instruct in the adjunct capacity in addition to my “day job”). The big lesson: no program is sufficient in and of itself if you do not listen to your employees and allow them to develop individually. Tution reimbursement is a tool–not a fix-all.
The purpose of education is to get the skills needed to perform a job, not to give one any sense of entitlement. However, better skills mean better performance and most employers will agree, better performers are entitled to better wages and advancement. Education benefits employers by brining them “job-ready” candidates with the right skills and attitudes. It makes sense to have tuition reimbursement because the skills aquired through education more than compensate for that temporary financial loss. I can say without a doubt that my education has improved my performance and that benefits both me and my employer. However, a graduate need not feel any sense of entitlement if they fail to use the skills they aquired to improve their performance. A great performance is always entitled and naturally attracts the attention of recruiters from top paying companies. If an employer fails to pay a competitive wage to retain educated employees, the employer will loose the top talent. Simply put, its not a question of entitlement, but competition that drives the market.