Free college may sound too good to be true, but it’s a reality for workers at a small but growing number of companies. These forward-thinking businesses are offering generous and flexible programs to workers that allow them to earn a degree while keeping their current job.
Sixty-one percent of companies already offer some type of education benefits for employees, according to the Society for Human Management. But traditional tuition reimbursement programs are usually limited in scope and may come with strings attached. You may have to stick with your employer after earning your degree or reimburse them for the cost of your tuition. The types of courses that a company is willing to pay for may be limited to those related to your current job. Plus, reimbursement amounts are often capped at $5,250 a year, since that’s the maximum that can be exempted from tax withholding under IRS rules.
The newest tuition reimbursement and assistance programs are far more flexible, covering more college costs and not requiring workers stay with the company after they graduate. The goal, it seems, is to help people acquire the skills for better jobs, even if that means leaving the employer that paid for their education.
Consider Dick’s Drive-In, a small Seattle chain that will pay up to $25,000 for an employee’s education. Jim Spady, Dick’s vice president, acknowledged that his company is a “transitional employer” and that most people who get the benefit will eventually move on to other jobs. Still, the perk is an important one, both to employees and the business. “You want the best employees? You should expect the best benefits,” he told the Seattle Times.
People who are looking for generous tuition benefits don’t have to move to Seattle to get them, however. The following three businesses are three big U.S. employers that will pay for all or virtually all of a student’s college education.
In April 2015, Starbucks expanded its College Achievement Plan to cover four years of tuition at Arizona State University (ASU) for all full-time and part-time employees. Previously, Starbucks had paid for the last two years of it employees’ education at ASU.
“The unfortunate reality is that too many Americans can no longer afford a college degree … by giving our partners access to four years of full tuition coverage, we will provide them a critical tool for lifelong opportunity,” said CEO Howard Schultz in a statement.
Students can choose from ASU’s 49 online degree programs. While Starbucks will cover the tuition and fees, students still need to cover upfront costs, for which they’ll be reimbursed at the end of the semester. After graduating, people have no obligation to continue working at the coffee chain.
2. Fiat Chrysler
Perhaps taking a cue from Starbucks, Fiat Chrysler announced in early May that it was rolling out a program that would offer employees at participating dealerships a “no-cost, no-debt college education.” Workers will be able to earn degrees through Strayer University, a for-profit private institution.
Unlike Starbucks, Chrysler will cover all costs up front. Classes will be offered in business administration education and other areas, and people won’t have to stay with Chrysler once they get their degree. One of the company’s main goals is to attract more high-quality employees.
“Many of our dealers have expressed concern over the availability of talent to fill open positions due to business growth and turnover in their stores, especially in metro markets,” Al Gardner, President & CEO of the Chrysler Brand, said in a statement. “Our goal is to position our dealer network as the ‘employers of choice.’”
The classes will be offered through Strayer’s Degrees@Work program, a new initiative that involves working with companies to offer educational benefits to their employees. Strayer’s enrollment and revenue has declined recently, and the partnership with Chrysler might be a way for the school to cope with a more challenging environment for for-profit colleges.
Unlike Starbucks and Chrysler, UPS has long provided educational benefits to employees. Employees – including part-time workers – can earn up to $25,000 in benefits over four years. But package-slingers in Chicago and Louisville, Ky., have access to even more generous perks.
Part-time employees who work overnight shifts in UPS’s Louisville facility can attend either the University of Louisville or Jefferson Community and Technical College for free, plus get reimbursed for books and earn bonuses for reaching educational milestones. Employees at the Chicago-area facility can receive up to $5,250 for tuition at one of seven area schools, plus allowances for transportation and monthly bonuses.
Like the Chrysler program, UPS’s free college program in Louisville (introduced in the late 1990s) was designed to attract and retain employees. Since then, about 14,000 people have worked at UPS while attending school and employee retention has improved. But the schedules students must keep in order to balance work and education can be brutal and students can occasionally go long stretches without sleep, as described in a recent article in the Atlantic.