McDonald’s has joined the large number of companies that pay for employees to attend college, with a relatively new tuition assistance benefit that includes some unusual features.
Begun two years ago, the fast-food giant’s Archways to Opportunity program is open to managers and front-line workers, at both McDonald’s-owned and franchised restaurants, a total of roughly 800,000 employees. Participants can finish a high school diploma online, learn English, attend college courses and talk with career and education advisers.
The fast-food giant created the benefit as a “way to leverage our size and scale as a force for good,” said Lisa Schumacher, director of education strategies for the McDonald’s Corporation. “We wanted it to be unique.”
Altruism wasn’t the only motivator, of course. Like other companies that employ many academically unprepared, relatively low-wage workers, McDonald’s faces a serious retention challenge. It’s a win-win, the company believes, if the tuition assistance program can help an employee stay on the job for more than just three months -- a key milestone in the fast-food industry.
In addition, unlike the high-profile partnership between Starbucks and Arizona State University and other exclusive arrangements between colleges and employers, McDonald’s is agnostic about where its workers go to college.
The company has formed loose partnerships with a broad range of colleges, including Ivy Tech Community College, College for America (an online, competency-based subsidiary of Southern New Hampshire University), Colorado Technical University and DePaul University. These institutions help McDonald’s employees with credit recommendations, offer additional tuition discounts and have trained advisers about the program.
Beyond partner colleges, participants can use their McDonald’s tuition benefit at any institution that is accredited by a federally recognized agency.
“We wanted people to have choice,” said Schumacher.
The company also pays the colleges directly, so employees don’t have to front tuition costs. Nonmanager workers can qualify for $700 per year, while managers at participating franchises get $1,050. Swing, department and general managers can receive $5,250.
Based on the $350 average tuition for a community college course, the company said its program means front-line workers can take two free courses a year while managers can take three or more.
But high school comes first. And since about 40 percent of McDonald’s crew members either do not have or are currently working toward a high school diploma, the company partnered with Cengage to pay for its employees to attend the educational technology company’s Career Online High School.
“We realized that people at our restaurants are at different places in their educational continuum,” said Schumacher.
The partnership was formed two years ago as part of the Archways to Opportunity program. So far 175 McDonald’s employees have earned their high school diplomas through the Cengage institution. And the company said the high school credential is structured to give its employees a boost toward college or a career.
Graduates from Cengage Career Online High School earn career certificates in one of eight high-growth fields, including child care, education and certified education. The high school program participants also are paired with an academic coach, who helps them develop a career plan.
As a result, McDonald’s is helping its employees move into new jobs in different industries, a recognition that they're preparing many people to leave while also identifying candidates for advancement within the company.
Schumacher said the company is considering partnerships with work force boards, its suppliers and large employers in other fields, to potentially help them identify “talent pools” among McDonald’s workers.
The philosophy behind these moves, she said, is the company’s goal of providing “America’s best first job.”
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More than half of employers (56 percent) offer some form of undergraduate tuition assistance for workers, according to a 2015 survey from the Society for Human Resource Management. The maximum annual tuition benefit, on average, is $4,591.
“It’s a smart thing to do,” said Peter Cappelli, a professor of management and director of the Center for Human Resources at the University of Pennsylvania’s Wharton School, adding that such programs often are a “good retention device.”
For example, he said, Marriott International’s tuition reimbursement rate proved “extraordinarily cost-effective” in making a big dent in its employee turnover rate. Cappelli also said the benefit is targeted by definition. “You only have to pay it for people who want it.”
Cappelli said he likes McDonald’s flexible approach, particularly about where employees enroll, rather than booking an exclusive partnership. “It’s better for students,” he said.
The company has faced some criticism over its employee policies in recent years, including over the wages it pays and other job-quality concerns. And at least one expert was wary about McDonald’s approach to tuition assistance.
“We’re a little hesitant to praise the program,” said Liz Ben-Ishai, a senior policy analyst with the Center for Law and Social Policy.
One concern, Ben-Ishai said, is that it’s often hard if not impossible for fast-food employees to have work schedules that are predictable and flexible enough for them to attend college classes.
“They have no idea if they’re going to have 10 hours one week or 40 hours the next,” she said.
As result, Ben-Ishai said, the adjustable pace of competency-based programs like those offered by College for America could be a good fit for fast-food employees.
McDonald’s said it included the advising portion of the program to help employees make decisions about college and a career.
The Council for Adult and Experiential Learning offers that service at no cost to McDonald’s employees. The company pays the nonprofit CAEL for advising, not referrals.
“There’s no benefit for us to advise them in one direction or another,” said Lynn Schroeder, CAEL’s vice president for client relations.
Schroeder said advisers help potential students identify their educational and work interests, while factoring in life challenges, such as discussing how many hours students can expect to spend on academics. Advisers are fluent in Spanish, the company said.
It’s important to help McDonald’s employees get off to as smooth a start as possible when they go back to school, said Schumacher, particularly for the large numbers who experienced “educational trauma” in the past.
“A lot of people at our restaurants are first-generation college students and are intimidated by the process and don’t know where to start,” she said.