The coffee chain is partnering with the school to offer the option to 135,000 U.S. employees who work at least 20 hours a week. The Seattle-based company says it will phase out its existing tuition reimbursement program, which gave workers up to $1,000 a year for education at certain schools.
The company says the program doesn't require workers to stay at Starbucks after they earn their degrees. They can also pick from a wide range of educational programs that aren't related to their Starbucks work.
Starbucks CEO Howard Schultz is scheduled to announce the program Monday in New York City, with U.S. Education Secretary Arne Duncan and about 340 workers and their family members in attendance.
It's not clear how many workers will choose to participate in the new program or how much it will cost Starbucks Corp. The company isn't disclosing the financial terms of its agreement with Arizona State University. But the program could significantly boost the enrollment for Arizona State's online program, which charges tuition of about $10,000 a year. That's roughly the same as the school's traditional degree program.
Tuition reimbursement is a rare benefit for low-wage workers in the retail industry, but Starbucks isn't the first to offer it. In 2010, Wal-Mart Stores Inc. launched a partnership with American Public University, a for-profit, online school, to give workers and family members partial tuition grants.
The retailer, based in Bentonville, Arkansas, says more than 400 of its workers have since completed degrees through the program. Wal-Mart's program also does not require workers to stay and allows them to pursue a variety of degrees.
Starbucks' existing tuition reimbursement program, which was rolled out in 2011, gives workers up to $1,000 a year for courses at City University of Seattle or Strayer University. So far, Starbucks has paid out $6.5 million under that program, said Laurel Harper, a company spokeswoman.