Employees at beauty empire Estée Lauder Companies are now eligible for $10,000 in student loan payment contributions under a newly announced addition to the firm’s benefits package.
The New York City-based conglomerate, which owns brands such as Clinique, MAC Cosmetics and Origins, partnered with student loan payback platform Tuition.io to administer a monthly $100 contribution to an employee’s student loans. The contribution caps at $10,000.
The company announced the benefit internally in September, right before annual enrollment, to raise awareness about the new benefit, says Latricia Parker, executive director of global benefits of the Estée Lauder Companies.
Employees were directed to input their student loan information with Tuition.io and saw the first contribution around October, she says.
“If someone is participating in it, employees are more engaged, they feel good about working here, and we’re sort of helping them today,” Parker says. “You’re talking about 401(k) plans and retirement plans, and for millennials, it’s very hard to talk to me about saving 10% of my salary when I have this massive burden.”
Six in 10 of the company’s 46,000 global employees are millennials, with 65% of those currently enrolled in the program falling into that category.
She adds that the company doesn’t know what the scope of the benefit will be because Estée Lauder Companies isn’t privy to what percentage of their workforce has student loans and how much those loans are worth.
“It’s hard to budget for,” Parker says. “We put some parameters around it so we can manage it and will continue to evaluate and moderate it.”
The student loan repayment program is the latest addition to the company’s robust benefits package, which includes a tuition reimbursement program and a 401(k) match. Employees need to contribute a minimum of 7% to receive the company’s maximum match of 100% on the first 3% and 50% on the next 4%.
Estée Lauder Companies joins the 4% of employers offering company-provided student loan repayment benefits, according to SHRM’s 2017 employee benefits report. Parker also notes that the company is one of the only luxury companies that offer the benefit.
“[We] want to help people where they are in their lives,” Parker says. “Those who have student debt, they value it tremendously.”
Parker says the decision to add a student loan repayment program to the company’s benefits package occurred before the Tax Cuts and Jobs Act, which slashed the corporate rate from 35% to 21% and prompted many large employers to increase wages and 401(k) contributions and hand out one-time bonuses.
The company will continue to look at how the new tax savings can be funneled back into the workplace, Parker says.
“We want to retain the talent that we have and continue to upskill them,” she says.
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