Tuition Remission and You

Vol. 13 No. 1

moneywave360

Tuition remission for faculty and staff means so many things to so many private-independent schools. To some, it’s a way to promote the school’s mission of inclusion. To others, it’s a perk, a way to find and retain wonderful staff and faculty. Even more people remember their own education or a friend whose schooling was supported through programs like this and wish to continue the tradition.

ISM theory, as we’ve written in The Tuition Book and discussed during podcasts, states that it’s possible to accomplish your mission of caring and trust without offering hugely expensive (and potentially unnecessary) discounts. Don’t believe it? Let’s tackle some common arguments in favor of tuition remission and outline some ways to keep the program’s positives.

“Our school’s mission promotes quality education to all, regardless of a family’s financial situation! How can we say no to our faculty’s children?”

Well, you can reject faculty or staff member’s children for several reasons, poor mission fit being the most important. At the same time, not offering tuition remission doesn’t mean that you don’t support your employees. It simply means that the school’s strategic financial plan doesn’t support free tuition—especially if it supports generous financial aid.

Instead of an automatic tuition waiver, why not have those teachers and staff who wish to enroll their children apply through regular channels and apply for financial aid, just like any other family? This scenario has the dual benefit of providing assistance for those on your staff who can’t afford the education, as well as showing parents that you treat all students equally, regardless of who their parents are.

“Tuition remission is a huge perk for our faculty and staff! How else can we get great people to work for us?”

The short answer to this question is “the school's mission.” Offering tuition remission can muddy the waters as to your potential employee’s motivations to work for you. If they have school-age children and you offer this benefit, you run the risk of them working while their children are in your school then leaving when they graduate. If the reason an applicant decides not to join your school family is that you don’t offer free education for his or her children, maybe that prospective teacher wasn’t the greatest mission-fit to begin with.

Furthermore, there are so many qualified and wonderful people job hunting these days, it shouldn’t be difficult at all to find someone willing to work without this seemingly necessary perk. As The Chronicle of Higher Education put in a recent commentary, “The history of the tuition benefit harks back to a time when colleges needed to offer such perks to attract candidates to lowly paid campus jobs. But the academic job market today is flooded with too many applicants for too few jobs in plenty of disciplines.” This logic applies perfectly to private-independent K-12 schools as well as colleges.

Finally, it's unequal in terms of monetary benefits. Say two teachers are paid $50,000 a year in salary at a school where the annual tuition is $20,000. They have the same workload and teaching experience, but one has children and the other does not. If the first takes advantage of the tuition remission program, that teacher is effectively making at least $70,000 from what amounts to a tax-free $20,000 bonus if even one of his/her children attends, creating a huge wage disparity.

“We’ve always had tuition remission! How can we suddenly just stop now? We’ll have a riot on our hands!”

That’s a tough one. One school recently tried to announce changes to its tuition remission policy at a faculty meeting, with no (obvious) staff input; the changes were handed down from administrators. However, the administration quickly realized that “further discussion of the issues was necessary” and decided to table the discussion while improving their overall communication.

There’s no need to repeat this mistake, though. Communication with faculty and transparency concerning your reasons for dissolving the program will go a long way to smoothing the path for this change. Try grandfathering in the policy change to allow current beneficiaries to keep the benefit while not starting tuition remission for new hires. Slowly, you’ll change the culture to one where people want to stay for the work they do every day instead of the incidental perk or two.

Additional ISM resources:
ISM Podcast: “The Biggest Tuition Setting Mistake Schools Make”
ISM Monthly Update for Business Officers Vol. 12 No. 1 Employee Benefits You Might Not Think Of As Benefits
ISM article "How Much Does It Really Cost Your School?"
ISM article "Affordability: Is Tuition Remission the Answer?"

Additional ISM resources for Gold Consortium members:
I&P Vol. 27 No. 7 Stability Markers and Tuition Remission
I&P Vol. 38 No. 13 Tuition Discounts and Your School’s Sustainability
I&P Vol. 31 No. 9 The 2005 School Head Compensation Survey: Personal and Professional Benefits
I&P Vol. 35 No. 15 The Real Cost of Financial Aid

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