It’s back-to-school season, making education top of mind for many employees — be it for themselves or their dependents.
But for many families, the push toward higher learning and professional development is as much a financial issue as it is one of access. This two-pronged issue drove Ally Financial to change its mindset on the topic of education benefits generally, CHRO Kathie Patterson told HR Dive.
“I know for us, we have done a lot to modernize our benefits to ensure we are attracting really strong early talent,” Patterson said. That led the company to institute a debt repayment assistance program, a benefit that “really resonates” with the generations of workers saddled with immense student debt, she noted.
That move, however, prompted “a significant number of employees” who had longer tenures to ask: Where is the benefit support for the broader organization? “It was a fair question,” Patterson said.
To that end, Ally introduced a 529 plan benefit, in which it would contribute $100 per month to an employee’s 529 account — a savings account used to help workers stow away cash for qualified education expenses, including a child’s college tuition.
Such benefits may flout the traditional idea that educational assistance benefits need to help employees only in their current roles or a role relevant to their future at the company, Patterson said. “Now it is really more about personal and professional development,” she added. “We’ve evolved our thinking.”
But even for companies that may tout extensive educational reimbursement programs, access to those programs may still be deeply limited by the nature of how reimbursement works — a problem Ally is still working through itself, Patterson said. Some of its tuition reimbursement programs had “unintended consequences” due to their design, such as employees in lower-paid roles being unable to leverage those benefits.
“What I’ve learned is that for some employees that are living paycheck to paycheck, the reimbursement doesn’t always work, because colleges want you to pay upfront,” Patterson said.
In the interest of social equity, Patterson added, the company is re-examining how these benefits work and how they can be accessed; “That is the next wave of what our focus is.”
For employers still on the fence regarding education benefits of all stripes — or those trying to convince higher-ups to invest — Patterson emphasized that such benefits are prime attraction tools for talent of all generations.
“It’s a win-win proposition,” she said. “A company wants individuals who are continuously learning and growing their knowledge base. Employees nowadays really use their employer as a connection point to a larger purpose through their work.”
Companies that can offer a platform that encourages continuous learning for all workers and their families are able to showcase learning as a cultural value — and help society overall, she said.