HR Insights: The Cost of Effective Training
By: Christ Taylor Insurance
The Benefits of Training Programs
Properly skilled employees are essential for a successful business, yet rarely employees enter a job with exactly the skill set needed. On-the-job training is vital to the creation and maintenance of a high-performing workforce. Though many employers consider training an expense and burden, one should consider it a wise investment in your employees’ and company’s future.
Training can be costly, but there are tax advantages associated with training programs. Because on-the-job training is generally considered a working condition fringe benefit for
employees, the fair market value of such training is excludable from the employees’ taxable income (assuming that the costs of training would be deductible as an ordinary and necessary
business expense had the employees paid for the training themselves). In addition, job-related educational expenses are tax excludable for employees. Employers may also deduct
training and education costs as a business expense.
Why is Training so Important?
In order for employees to perform their jobs proficiently, they must be given the tools to succeed. Solid on-the-job training, both at orientation and ongoing, equips your employees to be productive and successful in their roles. In addition, training your employees demonstrates that you value them and consider them important parts of your company’s future, which can boost employee morale. Studies have shown that retention rates are higher for employees who have completed thorough training programs, both when hired and later on, than for employees who have not. Training programs also help keep standards and expectations consistent throughout your company. They play a key role in communicating and teaching new company policies and procedures, new laws to comply with, new organizational goals and direction and new technologies.
Types of Training
There are multiple types of training; some are universal, while many are tailored to a particular industry or business, so assess the needs of your company and decide which types
of training will be most valuable. Common types include new employee orientation, general job skills, sales training, management or leadership training, communication training,
safety training and organizational development training.
Elements of a Training Program You should begin with an analysis to identify which areas need additional training and development. Such an analysis would include identifying deficiencies in performance, evaluating the impact of those deficiencies and prioritizing which ones are most important to address. Then, select training programs that are in line with your areas of concern and objectives. Another critical step is deciding who will teach your training sessions. The instructor will greatly impact the value of the training. You may decide to choose appropriate, knowledgeable members of your organization or to outsource training to a professional. Many HR consulting firms offer training and development programs. Your physical training materials (worksheets, charts, etc.) are also a crucial aspect of a good training program. These are what your employees will take away from the class and should provide a good reference guide for the information learned during the course.
Once a program is designed and implemented, it is also important to continuously evaluate its effectiveness and try to tie it to employee performance. Identify ways to improve the program to ensure that you are realizing the full benefits of your investment.