Starbucks: Tuition reimbursement is only for juniors and seniors

June 19, 2014 7:35 PM PT

Starbucks Corp. clarified its tuition reimbursement program for workers Thursday after facing scrutiny from education experts who questioned the extent of the company’s largess.

The Seattle coffee giant announced this week it is helping employees who enroll in Arizona State University’s online bachelor’s degree programs for all four years. The company said it would provide full tuition reimbursement to juniors and seniors, and that freshman and sophomores would be eligible for a partial scholarship and other financial aid.

The assistance is open to employees who work at least 20 hours a week in any company-operated store, Starbucks said, regardless of how long they’ve been with the company.

Days later, however, the coffee purveyor clarified that scholarships to workers in their freshman and sophomore years were provided by ASU, not Starbucks. Company spokeswoman Jaime Riley said those students will get scholarships from ASU that will cover about 22% of tuition for their first two years.

Starbucks is assisting its workers who qualify as juniors and seniors, but that help comes with a long list of caveats.

These college-goers will first receive scholarships from ASU that will cover roughly 42% of their tuition, Riley said. Depending on their financial situation, they may also qualify for additional grants or aid.

The coffee company will reimburse students for any tuition that is paid out of pocket or that is covered by loans. However, Starbucks will only pay out an initial lump sum to juniors and seniors after they earn 21 credits. Additional reimbursements will be dispensed in 21-credit increments as well. The money is paid once a year in an employee’s paycheck, Riley said.

Details about ASU’s scholarships to Starbucks students were first reported by the Chronicle of Higher Education. Arizona State President Michael Crow told the Chronicle that “none” of the scholarships it is providing comes from Starbucks.

Riley said Starbucks’ original statement “created a lot of confusion.”

“We are providing a little more information because we realize there is confusion,” she said.

The program design has attracted the ire of critics who point out that students could pay thousands of dollars out of pocket for their first two years and then wait long periods of time before getting reimbursed by Starbucks for their last two years.

Phil Regier, dean of ASU online and extended campus, told The Times this week that the college is not providing a tuition discount. In an interview with the Chronicle, Crow took issue with that term.

“We have not agreed to a price reduction,” Crow told the Chronicle. “We’ve agreed to a financial-aid package.”