Can Tuition Assistance/Reimbursement Be Considered A Benefit

Gar

Could tuition Assistance/Reimbursement be considered a benefit even though it is not indicated as such in the employee's handbook? Also, if it is a benefit, can an employer deny employee this benefit due to a department's heavy workload?

Down_the_Middle

Prior to adding our T-R benefit to our employee handbook, we considered it an employee benefit for quite some time. We had a policy that addressed it even tho it wasn't incorporated into the handbook. We currently require Department Directors to sign off on T-R requests and they may not recommend the request based on a variety of reasons such as: recent poor perf scores, current disciplinary action, dept'l workload issues, etc..... We've not denied an employee from requesting T-R due to workload, but we have postponed their approval for 1-2 quarters.

Scott Ruth

Most people loosely consider these types of programs as "benefits." So long as expenses are paid from the general assets of the company, such a program is not subject to ERISA. However, to the extent any payments under the plan qualify as tax-free, the Code requires a "separate written plan." If you want to require some kind of approval, I would definitely set this out in the plan document. Of course, this kind of discretion, while permissible so long as it does not cause discrimination, can contribute to morale problems if perceived as being used arbitrarily.

Form 5500 is also required by the IRS for certain tax qualified plans. You may want to get an opinion on this with respect to your specific plan.