Professional Certification Reimbursement Stipends: The Ultimate Guide

Why offer a stipend for professional certifications?

A 2023 report from Forbes Advisor revealed that nearly half (46%) of employees aren’t happy with their current benefits package. They're receiving benefits that either (a) don't reflect their needs and interests or (b) simply aren't sufficient.

Professional certifications are a big draw for employees, 70% of whom explicitly say developing their work-related skills is a top priority.

They provide tangible proof of their skills and qualifications. And there are untold benefits to facilitating them:

• Better equipped employees
• Fewer organizational skills gaps
• A culture of learning in the workplace
• Improved recruitment and retention rates
• Increased team productivity and efficiency
• Greater opportunity for career advancement and personal growth

And for your team members who can’t do their job without a license or certification: How loyal do you think they are if they're forced to pay hundreds of dollars just to work for you?

As for the stipends themselves, they're easy to offer! 

• They're flexible and (if done right) budget-friendly
• They're easy to manage (assuming you use an automated, tax-compliant platform like Compt)
• Employees prefer them over a "flat" raise

How a professional certification reimbursement stipend works

Normally, employee stipends are disbursed monthly, quarterly, or annually through payroll. Professional certifications are special because there is usually no set date or cycle for earning them—each employee will have different payment, award, and renewal dates.

Plus, most certifications are good for a few years. Only a few employees will need to use it every year, so it's a lot harder to standardize than, say, a health and wellness stipend all your employees spend every month.

That's why it's best to cover employees' certifications and licenses using what we call the stipend reimbursement model.

1. An employee adds their certification course or exam to their online cart.
2. They submit the receipt.
3. HR and finance review the claim to make sure it fits within your policy.
4. When it's approved, they see the money on their next paycheck.

That way, employees can still choose the courses and study materials that fit them best. But you aren't forced to front the money or pay for unused benefits.

Professional certification vs. professional development stipends

It's common for employers to lump certifications in with professional development. There's some overlap in what a professional certification stipend covers and how to use a professional development stipend.

However, there are distinct differences. Professional development stipends...

• Cover the cost of various types of learning and development opportunities (e.g. courses, workshops, conferences)
• Can be used for both work-related and non-work-related learning
• Are often discretionary, meaning employees must ask for approval and reimbursement

Meanwhile, professional certification stipends...

• Cover the cost of obtaining or renewing specific certifications required for an employee's job
• Have specific eligibility criteria and procedures in place (e.g. proof of completion or a passing score on an exam)
• Might be a set benefit, meaning employees are automatically eligible for it, solely by working in a position that requires the certification

Professional certification stipends in practice

Organizations across dozens of industries provide stipends for worker certifications. In one Robert Half survey of over 1,000 CFOs, a whopping 94% of them said they covered those expenses.

Let's dive into a few examples of certification stipend reimbursements in practice:

1. HCA Healthcare

HCA Healthcare's certification support program offers online prep services and pays testing fees for team members obtaining advanced clinical certifications.

2. Gradient AI

Gradient AI's benefits package includes paid industry certifications for insurance, financial services, and risk management.

3. Analytics8

Analytics8, a full-service data analytics consulting agency, covers employees' professional costs like certification exams, training courses, and online subscriptions.

4. Salesforce

In addition to its innovative learning and development program, Salesforce pays for certifications and offers study materials from its registered partners.

5. Amazon

Amazon's Career Choice Program is primarily geared towards tuition reimbursement, but it also covers up to 95% of the cost of certifications and licensing programs in IT, manufacturing, and transportation trades.

Offering your own employees professional certification stipends

When it comes down to it, every organization has its own reasons for offering benefits like professional certification stipends. But they all boil down to investing in employees' career growth and your company's success.

If you're thinking of adding a certification stipend to your benefits package, start with these steps:

1. Identify the most beneficial certifications for your business.

For some businesses, this is obvious. A healthcare organization, for example, needs its nurses and nurse practitioners to have a current BLS certification.

If it isn't as clear-cut, consider your organization's skills gaps and future goals. For instance, a SaaS company that's breaking into the healthcare industry might want to require its product and dev team to obtain a HITRUST certification to develop their skills around and prove trustworthiness with protected health information.

2. Determine the budget and eligibility criteria for your stipend program.

Certifications can cost well into the thousands to obtain. While a larger company probably has the resources to offer more comprehensive coverage, you can offer a meaningful stipend even with a limited budget.

Consider funding structures and eligibility requirements such as:

• Limiting the number of certifications an individual can get per year
• Only including "essential" certifications (e.g., a CPA certification for your accounting department)
• Requiring employees to work for your company for a certain period before they can receive reimbursement
• Offering partial reimbursements rather than full coverage

Remember, your stipend needs to be an inclusive employee benefit. Every employee in the same role needs to have equal access to the same resources and support.

3. Configure your program in your benefits software.

Compt can help you manage professional certifications, as well as all your other stipends.

It's easy to set up, too.

• Start by creating a new stipend, and choose "Professional Certification" from the list of options.
• Configure your eligibility criteria, such as what employees or segments are eligible for this perk.
• Have employees upload their proof of expense and any necessary documentation.
• Approve requests, and disburse stipends through payroll.

Then, every time your team members dive into a course or take an exam and emerge as certified experts, it'll be you (the totally cool HR pro) they'll think of.