By: First Union
Why Your Small Business Should Offer Tuition Assistance
Should my small business invest in tuition assistance for my employees? Should my small business offer tuition reimbursement to all employees? What terms should be created around my small business's tuition assistance program? What is the difference between tuition reimbursement and tuition assistance? Is a tuition assistance program worth the investment of my small business?
It should be no surprise that with the United States' current student debt crisis, more and more businesses are starting to offer tuition assistance and reimbursement programs. If your small business wants to invest in your employees in hopes that what they learn can be applied at your company for the long haul, definitely consider starting a tuition assistance program. There are so many benefits to offering a program for your employees - and your employees are not the only ones that benefit!
Some of the most successful companies in the world have one thing in common: their tuition reimbursement program availability! We're talking about Google, Apple, Starbucks, and many more.
There are a couple of things that should be considered when starting a program:
- Determine whether you will provide tuition assistance or tuition reimbursement for your employees to expand their education.
- Tuition Assistance: Your small business provides the funds upfront (full or partial depending on your small business's policy/).
- Tuition Reimbursement: Your small business provides the funds after the employee has hit a milestone (registration, start-of-classes, or upon completion of the class/).
- Create terms in your policy around the timing of education and length of stay with your small business. Many companies require an employee for whom they have funded their education to stay with the company for two years upon graduation. Some only require a year, but consider this: make sure you can reap the benefits of providing funding toward their education. Make them invest in your company the way you have invested in them.
Here are some of the top reasons why your small business should offer tuition assistance and/or tuition reimbursement:
You Small Business Will Attract Top Employees in Each Field
Think about it, if people know you continually support your employees' growth and development, you are guaranteed to hear from the top workers in your industry. The brightest of employees know that knowledge is ever-changing and must always be accessed to improve not only themselves as an employee but the company they work for. Offering tuition reimbursement shows high-value candidates that your small business is investing in their employees' professional and educational growth - and that can be the deciding factor for some when accepting a new position.
Your Small Business will See a Reduction in Turnover
The reality is that if you're going to expand your employee's knowledge and fund their educational experience, they are going to be tied to your small business during that time, as well as a minimum of the required time spent post-graduation, per your small business's policies. Not to mention, most employees will want to stay because they have been applying their continued education to the projects and processes they work on for your small business.
With a reduction in turnover, you will see a reduction in cost. Employee turnover, from an employee, leaving, to recruiting, hiring, and hiring a new employee, with the lag-time to get the new employee up to speed, your small business will save a lot of time and money!
When it comes to your small business's (optional/) contractually enforced loyalty, make sure you also outline what happens if the policy is broken - most time identified as having to pay back your small business the money you invested in their education. These policies help ensure a low turnover.
Your Small Business will Experience an Increase in Productivity
Not only will you see a lower turnover rate, but you will also experience an increase in productivity because you have a more educated workforce. Knowledge is power and education is truly invaluable (of course there's a price tag, but what you can do with an education shows very few bounds/). Depending on the industry your small business is in and the types of education programs offered, you could see the development of their soft skills or even their more specialized skills.
You will see improved performance and increased productivity based on an increase in access to knowledge.
Your Small Business will Receive Tax Breaks
I guess the monetary piece should be saved for last because your company can receive tax breaks for supporting your employees' continued education. Assuming your small business's policies satisfy the Internal Revenue Service's (IRS/) educational assistance program requirements, the United States government will reimburse companies for up to $5,250 per employee per year in educational expenses. Additional government reimbursement may apply for employees taking courses specifically geared toward their job duties, which allow your small business to offer valuable benefits to your employees for a reduced and sometimes negligible cost.
The best part of an employee reimbursement/tuition program - it's an option which means your employees are self-motivated. Those who take advantage of the program are on a path to improve themselves, and your business will organically benefit from their drive and determination. Additionally, your small business has insight into which employees are productive, self-motivated, are serious about their personal development, want to improve their current situation at work, and want to be decision-makers at a higher level in your small business. So many benefits, so little time!
Do You Want to Look at Your Financing Options?
If you find yourself needing to find funding for your business, First Union Lending is here to help.
We have nine different business loan types to choose from. This means that we're uniquely qualified to help you find the perfect loan to open your small business.
Applying for a business loan doesn't affect your credit. Better yet, your business loan may be approved as soon as the same day.
To discuss our business loans with one of our lending experts, click here or call 863-825-5626. We'll talk about our various business loans and help you find the right one.
Get started with the process now by learning more about our business loan types.