Time for Back to School?

If you think you can’t afford to educate your employees in this economy, think again. Your investment in key staff is more important now than ever: not only will they gain in effectiveness; the loyalty it can inspire should help retention.

There are several options for paying for education: some for businesses, even more for individuals.

Section 127 plans allow you to provide up to $5,250 annually in tax-free benefits. Even if the courses aren’t job-related, as an employer you can deduct costs as business expenses. Those costs include tuition, fees, books, equipment and supplies. Section 127 plans cover degree programs, individual courses and even conferences. They don’t cover everything, though: don’t try to deduct costs for sports, games or hobbies.

There are limitations: if the employee using the benefit is a shareholder, owning 5 percent or more, he or she can receive up to 5 percent of the program benefit. This means that Section 12 is an especially valuable option if several employees participate and more difficult to use if most of your employees are shareholders.

Educational assistance can also qualify as a fringe benefit. In this case, the courses must be directly related to improving or maintaining the employee’s job skills and cannot help him or her qualify for a new trade. There is no annual limit on educational assistance as a working condition fringe benefit; and additional expenses (e.g., travel, meals, lodging, certain tools and expenses) may qualify. Provided the requirements for this option are met, this option can kick in when the Section 127 limit of $5,250 has been reached.

Of course, for some business, even these options seem out of reach. That doesn’t mean education is out of reach, too.

Mentoring is an often overlooked option that can build community within a company and has been proven to enhance retention. By appointing a seasoned, trustworthy employee to mentor a less experienced one, you demonstrate your company’s investment in both at once. The mentee gains the guidance and wisdom of an experienced colleague. The mentor learns his or her perspective and loyalty are valued.

The lessons shared are not limited to company policies and procedures, either. The mentor can offer suggestions that will improve the new employee’s interpersonal skills and decision-making strategies.

The Community Foundation of the Eastern Shore, in its Partners in Nursing program, is using mentoring to strengthen not only area health care providers but the community as a whole. With a grant from the Robert Wood Johnson Foundation, the CFES is using mentors to support new nurses and nurse leaders.

It’s critically important that you select your mentors carefully and create matches that encourage the mentee to take advantage of the opportunity. The most successful mentors have leadership abilities and are objective, compassionate and admirable and listen well.

However you choose to invest in helping your employees to learn, you’ll find that education pays now and long into your company’s future.