As the restaurant industry grapples with perennially high turnover rates, companies are looking to expanded benefits programs to keep employees engaged. One such benefit: financial perks and opportunities for employees looking to work and attend school at the same time.
Employee education programs are not new to the major quick-service brands, but a tight labor market has led operators to increase focus on other ways to attract job seekers and keep existing employees.
“Wage is just the starting place,” Michael Lastoria, CEO of 35-unit &Pizza, told Nation’s Restaurant News in December. “If you pay someone what they already think they are worth, don’t expect people to high five you. A living wage is the bare minimum. You have to think of all of these other benefits you can offer.”
Education programs can have a positive impact on staff retention rates. In a 2016 case study published by online education platform Career Online High School, for example, one McDonald’s franchisee in Illinois reported a retention rate of 70% — nearly double the state average for McDonald’s employees — after implementing a high school diploma program through COHS.
“Providing educational benefits to employees is a great retention and development tool, but it is also a brand story,” Jason Smith, compensation manager at Denny’s and president of the Chain Restaurant Total Rewards Association. “When companies help employees accomplish their education goals, they are telling their customer they care and they believe in second chances. This is a powerful brand statement. These programs create a sense of loyalty.”
Here’s a look at how eight of the country’s largest quick-service chains are building and expanding their education benefits.
Papa John’s International Inc. last month said it would start offering free tuition at Purdue University Global for 20,000 corporate employees, as well as discounted tuition for employees at franchise-owned restaurants.
“We believe this is a truly unique tuition program in our industry,” Papa John’s CEO Steve Ritchie said in a press release. “We’re excited to partner with such a well-respected institution to help us deliver on such a robust career growth opportunity for team members who want to pursue their goals and further their education.”
Employees at the pizza chain are eligible for free tuition at the online-only institution if they have worked more than 20 hours per week for at least 90 days. They can pursue 180 different degrees, including those outside specific hospitality programs, such as accounting, finance, cybersecurity and information technology. Franchisees’ employees will receive a 20% tuition reduction for associate and bachelor’s degrees and a 14% reduction for master’s degrees.
Other restaurant chains are ramping up investments in scholarship funds. Chick-fil-A Inc., for example, has nearly tripled the amount of money available through its Remarkable Futures scholarships over three years, from $4.9 million in 2016 to $15.3 million in 2019.
“We believe that providing these scholarship opportunities is a unique opportunity for us to attract and retain top talent and allows us to incentivize team members as they serve our guests in restaurants throughout the country,” said Rodney Bullard, Chick-fil-A’s vice president of corporate social responsibility, in an email interview.
According to the Atlanta-based fried chicken chain, 90% of surveyed 2018 scholarship recipients said that they planned to continue working at Chick-fil-A because of the scholarship.
Chick-fil-A has awarded $75 million of Remarkable Futures scholarships to employees since the program began more than four decades ago. Employees can apply for a True Inspiration scholarship ($25,000) or True Leadership scholarship ($2,500).
True Inspiration scholarships are given each year to 12 Chick-fil-A employees nationwide who are either currently enrolled or are planning to enroll in college and are actively involved in their communities. The number of True Leadership scholarships varies each year. This year more than 6,000 will be given out. Both scholarships have a minimum grade-point-average requirement.
In addition to the merit-based scholarship opportunities, Chick-fil-A also offers a 30% tuition discount at 100 accredited universities and colleges around the nation.
Chipotle Mexican Grill Inc. is upgrading its tuition reimbursement program with the April 1, 2019 launch of “Cultivate Me” in partnership with Guild Education.
This reinvigorated version of the burrito chain’s current education benefits program will open a $5,250 tuition reimbursement for employees who work at Chipotle for a minimum of four months at least 15 hours a week. Reimbursement is now available for any school or program, not just specific partner schools, including trade schools and specialty degrees. Employees can choose to receive up to 44 college credits ($15,400) for on-the-job training.
Additionally, “Cultivate Me” will extend its General Education Development certificates and English as a second language courses programs to employees’ families, including parents, spouses, siblings, domestic partners, and dependents.
“We understand that for some individuals there are dreams beyond the restaurant industry and we want to support them by offering a greater variety of courses and not limiting their options,” said Scott Scansen, Chipotle’s senior director of total rewards, in an email interview.
Employees can also choose to be mentored by a personal success coach, who can help with anything education-related, from career guidance to applying for financial aid.
Taco Bell is also increasing investment in its existing scholarship programs. In 2019, the company will double the amount of scholarship funds awarded to employees to $1 million. Also new to the program is the “Round it Up” program, which will let customers “round up” their meal totals to the nearest dollar. All extra change will go toward the foundation.
The Taco Bell Foundation offers two major scholarships: The Live Más scholarship — which is open to both employees and non-employees ages 16 to 24 for any post-secondary degree — and the Yum! Andy Pearson scholarship program, which offers individual scholarships to employees at company-owned restaurants.
The Live Más scholarship — ranging from $5,000 to $25,000 — is not merit-based but, rather, is given to students who demonstrate their passions and goals in a two-minute application video.
In addition to scholarships, Taco Bell last year started offering tuition discounts for online courses and degrees, college credit for job training, and between $3,000 and $5,250 in tuition assistance funds through a partnership with Guild Education.
“In Taco Bell’s partnership pilot with Guild Education, those who enrolled in a course, program or degree through Guild had a 98% retention rate over six months, a 34% increase over employees not enrolled,” a Taco Bell representative said. “In addition to boosting retention, we hope these programs attract new talent to support our hiring goals.”
McDonald’s Corp. launched its Archways to Opportunity education program in 2015, which provides online high school diplomas, college tuition aid and access to college advising and English as a second language courses, and has offered $48 million in college tuition funds over the past five years.
In March 2018, McDonald’s said it would be tripling its investment by allocating $150 million through 2023 to employees in need of college tuition assistance. The restaurant chain also lowered the requirements for application from nine months to 90 days of employment, and opened up the benefits to part-time employees working at least 15 hours per week.
Last October, McDonald’s launched the “Where You Want to Be” campaign, which advertised the success of employees who take advantage of the Archways education opportunities. The marketing campaign also emphasized the new McDonald’s career advising program, which pairs industry experts with select employees in a mentor/mentee relationship.
Starbucks Corp.’s College Achievement program partners with a specific institution — Arizona State University — to offer full tuition coverage for Starbucks employees to receive a bachelor’s degree through the university online program.
The nearly five-year-old program allows employees to choose from about 80 undergraduate degrees. To date, more than 2,300 Starbucks employees have graduated college through the partnership and 46% of the graduates are still with Starbucks. The coffee chain has said its goal is to have 25,000 Arizona State University graduates by 2025.
In 2017, Starbucks launched the Pathway to Admission program, which helps employees who are not currently eligible for admission to Arizona State University take courses and improve their grades to get into the college program.
“It’s a core principle at Starbucks that if we take care of our partners, they will take care of our customers,” Starbucks communications manager Bailey Adkins said in an interview.
Through Life Unboxed EDU — which launched in 2015 in partnership with Excelsior College and GED Works — Pizza Hut employees can get college or high school equivalency credit for on-the-job training. Additionally, employees get a 50% tuition discount for attending Excelsior College’s online undergraduate program, or 15% off for graduate programs. Full-time employees can get up to an additional $5,250 to go toward tuition, books, and fees
For employees looking to complete their high school degrees, employees can get their GED costs reimbursed by the company at 40% of Pizza Hut’s franchised restaurants.
Employees of Pizza Hut, which is a division of Yum! Brands Inc., are also eligible for the Yum! Andy Pearson scholarship.
KFC employees can take advantage of the company’s nonprofit organization, the KFC Foundation which offers college tuition aid through the REACH Educational program and GED testing support and personal advisors through Rise with GEDWorks.
Through the REACH grant — a merit-based scholarship of $2,000 to $3,000 — recipients can also get discounts on textbooks and other college expenses. In 2019, KFC is offering 500 grants of $1.1 million total. Rise, meanwhile, is available to any employee looking to get their GED and is not competitive.
“We regularly look at how foundation programs affect retention and there’s always a positive correlation between engagement in Foundation offerings and staying employed at KFC,” said Krista Snider, managing director of the KFC Foundation, in an email interview. “Our latest data on the REACH Grant, for example, shows that retention among those taking advantage of REACH is 22% better than the system average.”
Employees of KFC, another division of Yum! Brands Inc., are eligible for the Yum! Andy Pearson scholarship as well.
Contact Joanna Fantozzi at [email protected]
Follow her on Twitter: @JoannaFantozzi
Correction: March 13, 2019
This story has been updated to correct details about McDonald’s Archways to Opportunity program.