How education benefits are reducing turnover
New financial wellness benefits have begun to spring up with various companies across the United States. Businesses such as PricewaterhouseCoopers are offering debt assistance benefits while companies like Geico, Walmart and Starbucks are offering college reimbursement benefits as a means of keeping employees with businesses longer.
Zoe Weintraub, head of business development at Guild Education, says her company partners with these businesses to offer tuition reimbursement benefits for frontline workers who may not have the opportunity rise through the ranks and need to be incentivized to remain with the company.
On top of offering tuition reimbursement, Weintraub said employees who work with the companies Guild partners with have the opportunity to receive college credits through the training they receive on the job.
“We have seen a 20% to 40% increase in retention with employees who are enrolled in an education benefit program versus their peers who are not,” Weintraub said.
Lance Salsman, city leader at Taco Bell Corporation, partners with Weintraub and Guild Education to offer these benefits at his stores and said he noticed a 10% jump in retention between Q2 and Q3 of the business year.
“We have prepped all of our district managers with this program and they are all fully aware that this program is available to our employees,” Salsman said. “At the same time, our managers are also enrolling in classes to work side-by-side with every single person that is involved with [education benefits].”
Weintraub said Guild has expanded from not only assisting frontline employees in achieving associate and bachelor degrees, but also GEDs, ESLs, management certificates as well as masters degrees.
Not only do employees have the opportunity to be reimbursed for tuition, Salsman said employees can receive college credits just from the training they are provided at Taco Bell.
“I have one store manager that has used her credits she received by going through our training and is almost about to receive her associates degree,” Salsman said. “She is a very dedicated manager and I think her heart is with Taco Bell a little bit more with having her degree come to her this way.”
Weintraub said Guild is able to determine a business’s ROI on education benefits by finding the company’s annual turnover cost as well as the cost of tuition for each employee.
“We are offsetting [tuition cost] by making sure employees take advantage of federal financial aid, which is typically $5,900 annually,” Weintraub said. “If the company is able to retain the employee for at least six months longer than other employees, the company is able to capture those savings, which could be up to $3,000.”
Weintraub adds that through tax compliance, employers will also be able to write-off 35% of all tuition dollars spent on employees.
Salsman said he wants to see at least one manager from every one of his stores enroll in the education benefit as well as have as many team members as possible enroll in the education benefit too.
“We always say, ‘work with us, stay with us,’” Salsman said. “We want them to be able to go on and do bigger and better things, but we want them to also remember the experiences they had while they were with us, so former employees can tell other people and we can retain our average employee retention.”