Tuition Reimbursement

By James Parker
/
June 28, 2022

What Is Tuition Reimbursement?

Tuition reimbursement is an optional employment benefit that may be offered by an employer. Tuition reimbursement can include either helping to pay off an employee’s existing loans or funding their pursuit of higher education on behalf of the company.

Tuition reimbursement is a type of employment benefit that is offered in addition to the employee’s pay. Other optional benefits that may be offered include stock options, an IRA, or an employee stock ownership plan.

The process of tuition reimbursement generally begins with the employee paying for their courses while employed at their company. After the course is paid for by the employee, their employer will pay them back either after the purchase or once the course has been completed. Some of the more generous tuition reimbursement programs may also cover the associated expenses of coursework such as the costs of textbooks, school supplies, and technology. 

A company’s tuition reimbursement program will often have certain limits or requirements. For example, the course that is being reimbursed must either be a course related to the company’s industry or give credit towards a degree that will benefit the company. Another common limitation is cost. While most companies will be willing to pay for courses, they must be reasonably priced or fit within a certain maximum that the company is willing to reimburse.

Some of the conditions for tuition reimbursement may also include performance. For companies who will not reimburse the cost of classes until after the conclusion of the course, they may require that the employee earn a certain grade in order to qualify for reimbursement. 

Key Takeaways

  • Tuition reimbursement is an employment benefit that offers an employee the opportunity to complete coursework that helps the company in exchange for the company covering the costs of that education.
  • Tuition reimbursement may only apply to certain courses and may be paid before or after the courses are completed. Employees may be bound to remain in their workplace while they participate in this program.
  • If there are limitations on the amount of reimbursement or requirements such as grade level achievements, they must be clearly and understandably presented in a place that the employee has access to before entering the tuition reimbursement program.
  • If you have completed coursework in service of your company but were not made aware of requirements that disqualified you from reimbursement, an experienced Employment Law attorney may be able to improve the outcome of your case by utilizing experience and expert knowledge.

Tuition Reimbursement and Employment Law

Tuition reimbursement can be a life-changing benefit for employees. By offering a chance to permanently advance their education, tuition reimbursement can greatly increase the skill level of a worker. To prevent miscommunication or abuse, there are some rules regarding the administration of tuition reimbursement programs.

The rules of a tuition reimbursement program must be known to the employees before they begin their classes. For example, if a tuition reimbursement program has a required grade, it must be clearly stated in an easily accessible place such as the employee handbook. Similarly, the maximum reimbursement amount if it exists must be similarly defined and explained to employees before undertaking their courses.

There is a good incentive for companies who do see fit to fund their employee’s education through tuition reimbursement. Employers will earn a tax deduction of up to $5,250 per employee that they reimburse the tuition of. This offers a tangible benefit for tuition reimbursement in addition to the improvement in the qualifications of the employee in question.

While specific tuition reimbursement programs vary in their specifics, one example case of tuition reimbursement can come from the federal government. The Federal student loan repayment program is a form of tuition reimbursement that specifically applies to federal student loans. Under this tuition reimbursement program, agencies may offer reimbursement to attract or retain certain employees.

Employees who take advantage of this program will have their tuition reimbursed up to $10,000 per year up to a maximum of $60,000. In exchange, employees are bound to a service agreement that promises at least three years of employment by the paying agency. Additionally, if the employee leaves voluntarily or is discharged as the result of misconduct, failure to perform their duties, or unsuitability to their position, then they are responsible for reimbursing their former employer.

Bottom Line

If you have enrolled in courses under the assumption that your company would reimburse you in accordance with their policy but they refused, either due to some hidden requirement or in spite of all the fulfilled requirements, you may be able to file a lawsuit to pursue a just outcome to your case. In order to file and prevail in your case, you will need the help of an Employment Law attorney.

An experienced Employment Law attorney can zealously advocate on your behalf in order to help you achieve the best possible outcome for your case. Using their legal expertise, trial tactics, and expert witnesses your Employment Law attorney can gather and present evidence that most compellingly represents your arguments and demonstrates how you fulfilled the expectations and requirements of your tuition reimbursement program.

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