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College has long been seen as transformative for people’s careers, but with soaring tuition costs, many people don’t have the chance to pursue a four-year degree. One company is trying to change that for their workers, and is part of a new trend among employers: making tuition costs part of its corporate benefits package.
Medtronic, a medical tech company with a workforce of around 95,000, rolled out an up-front college tuition assistance benefit for tens of thousands of its employees in the U.S. and Puerto Rico in 2022. So far program participants have completed 25 bachelor’s degrees, and more than 600 workers are currently enrolled in some kind of education program. The company has spent a total of $7.7 million covering tuition costs so far. And critically, tuition is paid in advance with no strings attached—any employee is eligible to enroll in the program, even if it’s their first day at the company, and they are not required to pay the company back when they leave.
Matt Walter, the CHRO at Medtronic, tells Fortune that this up-front guarantee was a game changer when it came to participation rates in the program. The company did have a previous tuition repayment program, but it had mixed results.
“One of the biggest barriers for employees, especially those coming into entry-level positions, is the affordability of paying for their tuition and then having us reimburse them after certain criteria are met.” he said. “That’s just a process, and there’s obviously paperwork involved with that. So this was an innovative way to cover everything up front, so that was no longer a barrier.”
Walter says that employees typically enroll in degree programs part time, so they can attend school while continuing their work at Medtronic. Some employees choose to pick up the degrees they never finished, while others are taking their first opportunity to get a traditional bachelor’s degree. About two thirds of program participants identify as first-generation college students.
“There’s a high level of engagement from first-generation college students, which is really great to see, removing barriers to opportunities for the first time in their families. There’s a huge emotional response to that, not just from the participants, but from their families,” he says.
Ironically, Medtronic has been distancing itself from degree requirements for years, with about a 76% increase in skills-based roles over the past year. But some positions still require formal education, which is where their tuition assistance program comes in. “It may be more important to have certain technology certifications, or for coding programming, that is a bachelor’s degree. So obviously we want to see folks making progress,” he says.
Walter says the program has been a hit with employees, expanded the company’s prospective talent pool, and made the company a more attractive employer.
“Tuition assistance is one kind of lever for us in a broader context of investing in employees and helping people expand their careers. That’s obviously a huge engagement and retention driver for us,” Walter says.
Emma Burleigh
emma.burleigh@fortune.com
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Watercooler
Everything you need to know from Fortune.
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