Thursday, March 28th, 2024 –– NEW YORK, NY –– Today, Summer and ADP announced an integration to support student loan benefits offerings. This relationship will make it possible for all of ADP’s retirement plan clients to offer Student Loan Retirement Matching and additional student debt tools through Summer’s platform. According to a 2016 Pew Research Center survey, 82 percent of respondents believe it’s “extremely” or “very important” to take part in ongoing professional development opportunities to stay up to date in their careers. This guide is intended to be used as a starting point in analyzing employer benefits and is not a comprehensive resource of requirements.
Student loan repayment vs. education assistance
Given the fact that roughly 43 million people have student loans, and that the U.S. Workforce is roughly 144 million people, that means almost 1 in 3 workers has student loans. For employers, helping their employees get out of student loan debt just makes sense. New employees are immediately eligible for group AD&D insurance for coverage equal to two times annual salary, adp tuition reimbursement rounded up to nearest thousand dollars, with a maximum benefit of $1,000,000. New employees are immediately eligible for group term life insurance for coverage equal to two times annual salary, rounded up to nearest thousand dollars, with a maximum benefit of $1,000,000. NORC provides tuition reimbursement up to $5,250 per calendar year for undergraduate and graduate courses after 6 months of eligible employment.
- Benefits packages fall under indirect compensation, which in some cases, is just as valuable to employees as their paychecks when they decide whether to work for an employer.
- Employers can help address these issues and differentiate themselves from competitors by offering student loan repayment benefits.
- This simple, yet powerful tool allows you to take control of your mileage spend like never before.
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On the other hand, managing benefits in-house can offer more control but may also require significant investment in expertise and technology. An employer paying student loans will usually establish specific ground rules. For instance, there’s typically a maximum amount they’re willing to contribute to a student loan balance. Employees may also have to work for the company for a certain period to be eligible for the benefit.
Additional Financial Aid Resources
As a Certified B Corporation, Summer has partnered with leading employers, financial institutions, unions, and government leaders to generate over $1.5M in savings for borrowers. After all, when you know a company is invested in you, it enhances not only your loyalty to them, but also your job performance and your job satisfaction rates. However, offering this benefit, even if it’s modified to fit a small budget, shows a strong commitment to employees and sends a message that you’re invested in their long-term potential. However, Congress temporarily amended the tax code for the period beginning March 27, 2020 and ending December 31, 2025.
Benefits administration
Others find benefits to be an HR and administrative challenge, but with the right strategy, they can be turned into a powerful recruitment and engagement tool. In some cases, employers may make lump sum payments; in others, they may set up recurring payments. The payments may be sent to the financial institution that holds the loan or directly to the employee. If the employee has multiple loans, payments might first be applied to the loan with the largest balance or the loan closest to being fulfilled. This article provides general information, and should not be construed as specific legal, HR, financial, insurance, tax or accounting advice.
- With an industry-leading mobile experience and seamless carrier integrations, you can help make it simpler and more convenient for your people to manage their benefits.
- This program is a benefit that Federal employees can take advantage of at their own pace to pursue or enhance their higher academic education.
- With a defined contribution pension plan, companies help workers save and invest for retirement.
- Benefits are perks or compensation beyond what employees earn in basic wages.
- By meeting this need with a student loan repayment program, employers can retain valued employees and attract new talent.
Tuition reimbursement, meanwhile, sees employees taking classes at night or on the weekends with some (or all) of their educational expenses covered by the organization. Many businesses who start an assistance program find themselves trending toward the middle to offer a mix of monetary assistance and time off to complete educational goals. If your company offers any type of student loan repayment assistance program, you need to be taking advantage of it. Currently, Congress is considering changing student loan repayment assistance to be a tax-free benefit . If Congress were to move these benefits to being tax-free, you could likely see a much larger number of companies offering this benefit. When it comes to helping employees advance their academic goals, you’ve got two broad options — an educational leave of absence or tuition reimbursement.
No more manually tracking miles and expenses, and transferring your reimbursement reports to ADP®. With TripLog’s integration for ADP, you can save hours every week and thousands of dollars every month by seamlessly uploading mileage and expense reimbursements to ADP pay data. As an employee-oriented organization, Hawthorne Foundation Inc. also offers outstanding benefits package. The academic alliances are an additional educational resource for Federal employees and Federal agencies. The alliances address the demand for high-quality learning and development as well as the extremely fast pace of change in the learning industry. These variations make it important for employers to understand not just the requirements of the FMLA and all state and local laws that apply, but also their HR responsibilities.
Commonly asked questions about benefits
Programs may either be a direct repayment made by the employer or discretionary, which allows employees to choose how benefit dollars are applied to their student loans. If your employees are paying for their own education, you can create an educational assistance plan to reimburse them for their educational costs — even if their studies aren’t job-related. This article is intended to be used as a starting point in analyzing employer student loan repayment and is not a comprehensive resource of requirements. It offers practical information concerning the subject matter and is provided with the understanding that ADP is not rendering legal or tax advice or other professional services.
Employers who succeed in keeping their employees engaged often find the right mix of both types of benefits. Small businesses can offer an attractive tuition reimbursement program to employees as long as it’s modified to fit their budget. While larger companies can meet the maximum offering of $5,250, which is the current IRS limit for tuition reimbursement, smaller companies can do something slightly different. Hopefully more employers follow the companies below into offering student loan repayment assistance to their employees. According to the Society For Human Resource Management, about 3% of companies offered some type of assistance program to help employees pay down their student debt.
Become an employer of choice with innovative, yet simple, benefits administration
Ideally, your corporate environment is appealing enough to encourage employees to invest in a career, but you’re always better served by written policy. This trend creates a fantastic opportunity for organizations seeking top talent. HR leaders should seriously consider the benefits of tuition reimbursement and educational leave as a way to grab the best talent and keep them committed to the organization.
From a day-to-day activity perspective, our benefits team especially has seen a big change in the types of questions they’re now being asked. With an industry-leading mobile experience and seamless carrier integrations, you can help make it simpler and more convenient for your people to manage their benefits. Plus, you’ll have access to deep insights that can help you understand changing employee preferences and advanced technology to adapt accordingly.