Chipotle’s Expanded Tuition Reimbursement Program Points Toward Future of Education Benefits

This month, the restaurant chain Chipotle unveiled an expanded tuition reimbursement program that it says will allow its employees to take college classes for as little as $250 a year:

The program … is a partnership with Colorado-based Guild Education and will allow employees at the burrito chain to pursue undergraduate or graduate degrees, taking college courses, earn a GED, or study English as a second language. The partnership builds on an existing tuition reimbursement program that already exists at Chipotle. That employee benefit received a big notable upgrade about a year ago, when Chipotle expanded the benefit to part-time employees after previously only offering the perk to salaried workers.

Here’s how Chipotle came up with the $250 figure: Employees would have access to up to $5,250 in tuition reimbursement per year provided by the company. An additional $5,815 could come from federal grants (though only for qualified candidates). Through those programs and the discounted tuition that Guild is offering, that’s how college costs can in some cases reach such a low figure. …

For Chipotle, an investment in the education of the company’s more than 60,000 employees can make sense strategically: about 90% of Chipotle restaurant managers came from lower-paid crew positions.

It’s encouraging to see large corporations with lots of hourly employees like Chipotle taking the lead on expanding tuition benefits. This is something we’ve seen in the news quite a bit in the past few years (thinking of places like Starbucks, which expanded tuition benefits to cover all four years of college last year). This type of benefit has been shown to pay off for employers as well as employees: Earlier this year, Cigna found that its tuition reimbursement program was producing an ROI of 129 percent!

It’s also important to note that Chipotle is giving employees the maximum tax deductible benefit (The IRS only allows $5,250 to be written off by an employer for an employee’s tuition). With tuition costs rising, this is not enough for many young Americans, but Chipotle’s partnership with Guild Education allows that contribution to stretch farther and offers an even more compelling education benefit. Starbucks’ program is also a partnership with an educational institution—in this case, Arizona State University. I look forward to seeing how other companies innovate in this field to go beyond simple tuition reimbursement and create new educational opportunities for employees in the future.