Over the past few years, three major employers, Starbucks, Walmart, and Amazon, have announced education assistance programs, each of which provides a unique example of how employer aid can attempt to make postsecondary education more affordable for working adults. Given that Black and Hispanic populations disproportionately occupy food service and warehouse jobs, these companies have presented their education assistance programs as a corporate solution to increasing educational attainment among Black, Hispanic, and low-income populations—populations that are heavily represented among Starbucks’s, Walmart’s, and Amazon’s entry-level workers, but that have lagged in degree attainment.1 However, at best, these programs are limited in their ability to meaningfully increase college access and completion, and, at worst, they can create additional barriers for employees seeking to obtain high-quality, meaningful credentials.

Close examination of the programs’ design elements—focusing on employer and employee financial contributions, employer limits on programs of study, and employer limits on institutions—reveals that, despite what may be advertised, corporate education assistance programs do not meaningfully relieve financial constraints facing employees interested in pursuing a college degree. These programs in fact limit the college and career choices for some of their employees.

What the Programs Offer

Starbucks, Amazon, and Walmart were contacted in order to gather more information regarding benefit participation and completion and other aspects of their programs; however, only Walmart has responded. A public records request was sent to University of Florida (UF) and Arizona State University (ASU) Online regarding these institutions’ partnerships with Walmart and Starbucks, respectively. UF provided the following contract and ASU’s request is still pending.

Table 1
Program Design
Employer Employee Eligibility Requirements Employer Limits on Programs  of Study Employer Limits on Partner Institutions Type of Employer Financial Contribution Timing of Employer Financial Contribution Employee Financial Contribution

“Career Choice”

Work one year continuously; a “blue badge” employee (FT) or benefits-eligible hourly employee (PT) Only associate’s or vocational certificates in “high demand” fields; varies regionally None 95 percent of tuition and fees after financial aid (grants); up to 3k (FT) and up to 1.5k (PT); reimburses textbooks Up front Costs vary by program

“College Achievement Plan”

Work three months continuously; twenty to twenty-nine hrs per week (PT) or thirty-plus hrs per week (FT) None Arizona State University Online 42 percent of tuition and fees; tuition reimbursement at the end of each semester up to $5,250 minus need-based grants per year Up front; reimbursement Costs can range from $324 to $451 per credit hour

Tier 1

Work three months continuously; no hours requirement Only bachelor’s or associate’s in business administration or supply chain University of Florida Online, Brandman University, Bellevue University Cover upfront tuition and fees after financial aid (grants) and employee contribution; reimburses for textbooks Up front Max. $365 per year

Tier 2

Same Work three months continuously; no hours requirement Only available programs offered through Guild Education partner schools Only Guild Education partner schools Less generous Up front Costs vary by program

Amazon launched an education assistance program called Career Choice in 2017. The Career Choice program covers up to $3,000 per year for full-time employees and up to $1,500 per year for part-time employees of incurred tuition and textbook costs after taking into account grants and scholarships received. Employees must work continuously for one year before becoming eligible for these benefits. Eligible employees also must work twenty to twenty-nine hours per week as a part-time employee and thirty or more hours for full-time employees. Career Choice does not require employees to enroll into specific schools; however, employees can only apply the benefits to vocational certificates or applied associate’s degree in “high demand” areas of study, such as commercial driving, nursing, computer-aided design, etc. Amazon also hosts classes in their on-site classrooms located within their warehouses.

Walmart recently reinvented their education assistance program for their employees, effective fall 2018.2 Walmart now covers all of its employees’ education costs minus an employee contribution of $1 per day and any grants and scholarships received. Walmart partnered with University of Florida Online, Brandman University, and Bellevue University through Guild Education; so, these education benefits are only available through these institutions. Guild Education is a third party that connects employees with partner institutions in order to utilize their education benefits. The benefits are only applicable to those earning an associate’s or bachelor’s degree in business administration or supply chain management. To become eligible for these benefits, employees must work for Walmart for at least three months. The benefits do not vary based on full-time or part-time status.

Announced June 2014, Starbucks began to provide its employees education benefits through their College Achievement Plan (SCAP). Starbucks partnered with Arizona State University (ASU) Online, where employees can earn a bachelor’s degree in a wide range of areas. Employees must work for Starbucks for at least three months and at least twenty hours per week to take advantage of these benefits. Through SCAP, employees are given a 45 percent discount off tuition and fees, and at the end of the semester, employees receive a tuition reimbursement which covers educational expenses that employees had to pay out-of-pocket, including loans.

In what follows, the three programs will be assessed on three aspects of program design—how much employers contribute versus how much employees contribute; educational institution partnerships; and course and academic program restrictions—to demonstrate their imbalances, and how they might be made to provide adequate benefits for an employee’s participation.

Employer and Employee Financial Contributions

Employers typically cap their contributions at $5,250 per year per employee, since that amount, if applied to qualified expenses, is eligible for tax-exempt status, applied to both the payment made by the corporation and the reimbursement received by the employee. There are numerous variations of tuition payment models, including tuition reimbursements and last dollar funding. Tuition reimbursement models, such as those used by Starbucks, shift up-front costs from employers to employees. For the employee, this payment model presents a high risk situation. For employees who do not qualify for any or much financial aid, their out-of-pocket costs will be substantial, and some students may take out student loans to cover up-front costs. This places additional financial burden on employees.

SCAP’s process for subsidizing their employees’ education through tuition reimbursements raises some red flags. While online education is thought to be a cost-saving education delivery tool, the money saved and revenue earned from distance education does not trickle down to the students enrolled. Although SCAP does discount qualifying employees’ ASU Online tuition by 45 percent, employees must cover the remainder. After taking into account the tuition discount, the cost per credit hour ranges from $324 to $451. Starbucks does not require its employees to take a minimum number of credits; however, to qualify for federal loans, students must enroll in at least six to eight credits per semester. An employee could see an out-of-pocket cost of up to $2,255 per semester if they decide to enroll less than half-time (up to eight credits per semester), and in that case, the employee would not be able to take advantage of federal loan programs. Employees could face more out-of-pocket costs than if SCAP allowed their employees to enroll into lower cost schools, or implemented a more generous “last-dollar” model, covering any tuition and fees after grants and scholarships. Starbucks should remodel their tuition reimbursement plan to provide up-front funding and reduce the costs ultimately borne by the student employee.

Walmart’s program is structured as a last dollar model. Modeled similarly to many college promise programs, employers pay nearly all the remaining tuition and qualifying fees after other sources of financial aid—including grants, scholarships, and federal aid—are accounted for. Walmart’s financial contribution covers nearly all remaining costs with the exception of a modest $1-a-day copay, which is the employee’s contribution. Compared to tuition reimbursements, this financial contribution model presents a higher risk for employers as it requires an up-front investment in their employees’ tuition and fees regardless of if they pass their courses or not.

“Despite what may be advertised, corporate education assistance programs do not meaningfully relieve financial constraints facing employees interested in pursuing a college degree. These programs in fact limit the college and career choices for some of their employees.”

For employees, last dollar models offer low to moderate risk compared to tuition reimbursements, because the costs are presented up front. A last dollar model that does not require employees to take on debt presents the least amount of financial burden, especially for workforce populations that may be experiencing significant amounts of financial burden in the form of debt and financial instability. For the case of Walmart, the $1-per-day fee paid by employees maxes out at $365 if an employee were to enroll in one of Walmart’s partner institutions all year round. Requiring their employees to invest even a small amount of money into their own education can offer some reassurance to employers. As mentioned previously, knowing the up-front costs, especially if the costs are low and manageable, will allow employees to take on smaller financial burdens when pursuing their education.

Although Amazon covers up to 95 percent of remaining tuition and fees up-front after financial aid, it caps its contribution at $1,500 for part-time students and $3,000 for full-time students. Considering that the average tuition and fees charged at a two-year is $3,413,3 employees, especially those that do not qualify for financial aid, could be potentially burdened by educational expenses exceeding Amazon’s contribution.

Institutional Restrictions

Some employers’ education assistance programs, such as Walmart’s and Starbucks’s, carry programmatic restrictions based on partnerships established between the employer and partnered higher education institutions. The benefits of institutional partners is apparent for the employer and the institution: employers streamline employees’ educational assistance to schools that offer services and/or areas of study that appeal to the employers and possibly the employees, and institutions receive a consistent and, if the employer has a large workforce, abundant student body. But these restrictions raise a central tension inherent in these programs: the immediate workforce needs of the company may provide a clearer pathway to certain jobs within the company, but may not match the long-term career aims of employees (who also put in significant time and dollars).

Institutional limitations may be positive from an employee standpoint if the employer is able to provide a quality-assurance function. Determining institutional quality is a challenge that eludes even experts in the higher education space; therefore, the task of companies, such as Walmart and Starbucks, evaluating the quality of institution would prove difficult and might favor institutional characteristics that do not necessarily lead to positive outcomes for students, such as partnering with proprietary schools which have been known to undercut students in quality of education.4

Starbucks has partnered with ASU Online. ASU Online offers a wide range of areas of study; however, funneling employees into one particular institution could create even more barriers. The admissions requirements, including the competency requirements, test score threshold, and high school GPA, have proven to be unreachable for many Starbucks employees. 20 percent of Starbucks employees who applied to ASU Online were rejected.5 Starbucks should expand the eligible schools to meet their employees’ range of academic needs. In the case of Walmart, although the company restricted education benefits to online programs, the company selected a range of institutions from open access to more selective, which could meet the variety of academic needs of their employees.

Employers should place employees’ academic and financial needs at the center when creating and evaluating the success of their education assistance programs. If a significant proportion of a company’s employees cannot participate in education benefits due to academic barriers constructed by institutional partnerships, more flexibility should added to the company’s education benefits in order to meet the various needs of their employees.

Course Restrictions

Education benefits are viewed as methods of recruitment and retention for companies; however, creating an education assistance program that is so restrictive could deter potential employees or not encourage current employees to stay.

Amazon does not restrict the institution in which their employees must enroll in order to receive benefits. However, their education benefits are only applicable to programs that lead to “high demand” occupations, which could limit future educational pathways for any employee with plans to eventually pursue a bachelor’s degree. This is due to the nature of some of the credentials that Amazon has deemed eligible for benefits. The eligible “high demand” fields include transportation, health care, mechanical and skilled trades, and IT and computer science, most of the occupations for which require a vocational certificate or applied associate’s degree. Institutions that offer certificates and associate’s degrees also provide transfer associate’s degree programs. Transfer degrees, as appropriately named, allow students to transfer to a four-year school with all of their earned credits following them. Upon enrolling into a four-year school, transfer students will have their transfer associate’s degree and be classified as an incoming junior because of the number of credits earned through their associate’s degree. Obtaining an applied associate’s degree prepares students for skilled workforce employment immediately after graduation and is not typically applied to a bachelor’s degree. Therefore, an Amazon employee participating in the Career Choice program will most likely not be able to start at junior status if pursuing a bachelor’s degree, possibly taking them longer when compared to students that complete a transfer associate’s degree. Amazon touts its Career Choice as being the game-changer, establishing the launchpad for their employees to start their career, whether with Amazon or elsewhere. However, limiting the benefits to only apply to vocational certificates and applied associate’s degrees places participating employees at a disadvantage. Amazon employees should be allowed to pursue transfer associate’s degree and not just applied associate’s degrees.

“Ultimately, education assistance programs reflect corporations’ financial incentives: employers are not motivated to design education benefits that provide employees complete college and career freedom without stipulations”

Walmart’s new partnerships provide an increased discount on tuition and fees, and the institutional partners specialize in educating working adults. Although Walmart’s programmatic model has evolved to where employees’ financial burden is lessened, there are still concerns about how beneficial their education assistance is for Walmart employees. First, this benefit program is only suitable for employees who want to pursue a career in business management or supply chain management. Through a second-tier education benefit offered by Walmart, employees are able to take advantage of tuition discounts available through Guild Education’s partner institutions; however, without the Walmart footing the majority of the bill, employees will have higher out-of-pocket costs. The per credit costs of Walmart’s partner schools range from $415 to $552. Although Guild Education’s tuition discounts could partially subsidize employees’ educational costs, the employees will most likely pay more than $1 per day to cover their educational expenses. The cost of Walmart employees pursuing their own career interests is high.

In a press release, Walmart stated that their college assistance program is “designed to remove barriers to college enrollment and graduation”; however, other features of the education benefits include job-related trainings and professional development, including leadership training, which speak more to workforce development than college access. In relation to college access, this program only appeals to select individuals who want to pursue a career in business and supply chain management, and for others, these program restrictions create additional barriers. If they truly want to remove barriers to enrollment, Walmart should expand the eligible schools and areas of study to appeal to their employees’ broad range of career aspirations. In reaching out to Walmart for additional information, it was made clear that this initial launch structure is not permanent and that the education benefits will eventually expand.

Increasing Access without Limiting Choice

Employer motivations for creating an education assistance program for its employees vary widely; however, the stated purposes of the education benefits provided by Walmart, Starbucks, and Amazon are clear: to improve educational opportunity for their employees. What is not clear is whether or not all employees, especially low-income minorities, will benefit from these programs. The contradiction lies between the companies’ public statements of being motivated to provide educational opportunities to their employees and their limited impact in addressing financial barriers. Furthermore, mechanisms used to increase college access should not adversely affect an individual’s college and career choices.

Ultimately, education assistance programs reflect corporations’ financial incentives: employers are not motivated to design education benefits that provide employees complete college and career freedom without stipulations. These programs present limited solutions that ultimately do not go far enough in remedying college attainment gaps.

PHOTO CREDIT:  June 17, 2014, New York, NY – Cliff Burrows, group president for Starbucks in the Americas and Teavana, speaks at the opening bell of the Nasdaq Stock Exchange on June 17, 2014 in New York City. Starbucks announced a partnership with Arizona State University (ASU), where Starbucks employees will be able to go to school online through ASU and Starbucks will pay for tuition. (Photo by Andrew Burton/Getty Images)


  1. According to a recent Pell Institute report, Black, Hispanic, and low-income students have the lowest college-going rates. Another report by the Pell Institute shows that Black and Hispanic populations have the lowest degree attainment in the United States. Although there have been gains in educational attainment among all racial/ethnic groups, significant gaps between these groups continue to persist.
  2. Before 2018, Walmart partnered with American Public University, a for-profit online school, to offer education benefits to its employees.
  3. U.S. Department of Education, National Center for Education Statistics, Projections of Education Statistics to 1986-87; Higher Education General Information Survey (HEGIS), “Institutional Characteristics of Colleges and Universities” surveys, 1969-70 through 1985-86; “Fall Enrollment in Institutions of Higher Education” surveys, 1963 through 1985; Integrated Postsecondary Education Data System (IPEDS), “Fall Enrollment Survey” (IPEDS-EF:86-99) and “Institutional Characteristics Survey” (IPEDS-IC:86-99); IPEDS Spring 2001 through Spring 2016, Fall Enrollment component; and IPEDS Fall 2000 through Fall 2015, Institutional Characteristics component.
  4. Walmart and Starbucks previously partnered with for-profit institutions, American Public University and Strayer University, respectively.
  5. Starbucks created Pathway to Admission (PA), a series of online courses to increase college readiness, through their partnership with ASU. It offers an alternative path to ASU Online. The effectiveness of PA is questionable due to low-income, minority and remedial students’ underwhelming outcomes with online courses.