Legislation Is Supported by Leading Education Organizations & Businesses
WASHINGTON – U.S. Senators Maggie Hassan (D-NH) and Todd Young (R-IN) introduced bipartisan legislation that would expand educational assistance programs to help ensure that employers have the tools to hire and retrain workers who may have lost their jobs due to COVID-19. The bipartisan Upskilling and Retraining Assistance Act would increase the amount of tax-free educational assistance that employees in workforce development programs can receive from their employers, and would modernize the program to cover expenses for tools and technology that are required for educational programs.
“The COVID-19 pandemic has devastated businesses across New Hampshire, upended industries, and put a record number of people out of work. That’s why it’s more important than ever to help employers adapt to these challenging times by expanding programs that retrain workers,” said Senator Hassan. “This bipartisan legislation would make long overdue changes to the tax code to encourage employers to provide educational and training opportunities to their employees. It will also help ensure that businesses have the workforce that they need to recover from this crisis.”
"As the coronavirus pandemic continues, Hoosier businesses and workers are left with few places to turn. We must invest in our workforce and equip workers with the right skills for high-demand jobs," said Senator Young. "The bipartisan Upskilling and Retraining Assistance Act would temporarily boost this important education assistance tax provision to scale up workforce development programs and provide more training for American workers during this pandemic and as the economy begins to recover."
“For close to 50 years, Starbucks has believed that our success as a company depends on the well-being and success of our partners (employees),” said John Kelly, Executive Vice President, Public Affairs and Social Impact at Starbucks. “Through the Starbucks College Achievement Plan, Starbucks has the opportunity to support thousands of partners in their education goals. We look forward to continuing the success of this program, and the opportunity to provide expanded assistance for our partners, in partnership with policymakers, the educational community, and other businesses around the county.”
“During such historic times of need in our rapidly changing workforce, the expansion of Section 127 is a critical tool for employers to recruit and retain talent while building an educated workforce,” said Paul LeBlanc, President of Southern New Hampshire University. “SNHU is committed to advancing social and economic mobility and the modernization of this bill is an important mechanism for removing barriers to opportunity and increasing access to education for America’s workers.”
Many businesses offer educational and training opportunities to assist their workforce in upskilling and retraining, but right now the tax code only allows employers to pay up to $5,250 for educational programs for their workers without workers having to pay taxes on these benefits. This cap has not changed since 1986, and is currently far below the cost of most higher education programs and does not cover the costs of tools and technology required to complete an educational program.
The bipartisan Upskilling and Retraining Assistance Act would update the tax code by enacting an emergency expansion of the tax exclusion from $5,250 to $12,000 for the next two years. It would also expand the tax exclusion to cover the cost of education-related tools and technology, including hand tools, construction equipment, computers and software, and other items related to the costs of a worker completing their education program.
The bipartisan Upskilling and Retraining Assistance Act is endorsed by Coalition to Preserve Employer-Provided Education Assistance, Jobs for the Future (JFF), Business Roundtable (BRT), Society for Human Resource Management (SHRM), American Council on Education (ACE), National Association of Independent Colleges & Universities (NAICU), American Association of Community Colleges (AACC), Presidents Forum, National Association of College and University Business Officers, Guild Education, Southern New Hampshire University, Western Governors University, Arizona State University, Excelsior College, UMassOnline, Walmart, Starbucks Coffee Company, National Retail Federation, Workday, American Mold Builders Association, National Association of Colleges and Universities Business Officers, National Tooling and Machining Association, North American Die Casting Association, Precision Machined Products Association,the American Hotel and Lodging Association, and Precision Metalforming Association.
Last year, Senators Hassan and Young joined Senators Tim Kaine (D-VA) and Cory Gardner (R-CO) in introducing the bipartisan Gateway to Careers Act to help expand economic opportunity for hard-working Americans and to support innovative businesses in need of a strong workforce. Senator Hassan is also focused on addressing workforce needs during the COVID-19 pandemic, and has called for additional funding for workforce development and career and technical education programs in the next COVID-19 relief bill.
Read a one pager on Senators Hassan and Young’s bill here.