When the employer agrees to pay for its employees’ education, it is making an investment in those employees. The degree should help the employee “perform better” in some capacity. In many cases, that would mean either driving more revenue or reducing more expenses.
Companies don’t cover employees’ costs for education out of their belief in the value of lifelong learning, it’s a calculated investment designed to have a financial benefit to the company and its owners.
This shouldn’t be a concern. Good companies attract good employees, regardless of the definition of “good.” If the company provides opportunities for employees at all levels, a worker with a fresh degree doesn’t have to look outside in order to take advantage of new skills or qualifications. Only the companies without confidence in its own ability to attract qualified employees need to handcuff its employees who seek additional education — generally a more ambitious group than average — to the company for several years.
What Does the Employer Get by Offering Tuition Reimbursement Benefits?
1. Smarter Employees
It may sound silly, but an intelligent workforce is pretty hard to come by. Employees who take advantage of tuition reimbursement tend to stay with the company longer. In addition to improved employee retention, the employer may have more employees who are easily promotable, saving them money on recruiting new employees.
2. Tax Breaks
Up to that $5,250 annual maximum, your employer’s reimbursement program costs are tax-deductible. Essentially, after the tax benefit, your employer pays very little to offer you this perk. Since the costs balance out and the company reaps the benefits of a smarter workforce, it’s a highly-desirable win-win scenario for the company....