|
Below is the current policy from the Orangebook.
SR
External Educational Assistance
| SCOPE: U.S.
| PHILOSOPHY:
| Digital is committed to continuous learning and development for all
| employees in order to maintain a competitive advantage in the
| marketplace. Therefore, Digital encourages and supports
| educational and training assistance to ensure that employees have
| the skills required for the Company's success. Digital's External
| Educational Assistance (EEA) program is an investment that:
| - maximizes productivity and job satisfaction;
| - reduces the potential for skills obsolescence; and
| - assists in fostering a healthy employee relations
| environment.
| External Educational Assistance is a Company-sponsored program that
| assists employees in taking approved courses, degree programs, and
| educational seminars and conferences that are not offered
| internally at Digital. A written development plan, tied to
| Digital's business goals, is a prerequisite to an employee
| requesting External Educational Assistance funds.
| POLICY:
| Digital's goal is to develop the types of skills, abilities and
| knowledge that will enhance employees' contributions to the
| Company. External Educational Assistance at Digital is designed to
| assist employees in meeting these objectives through their
| completion of courses, seminars, conferences and programs that are
| sponsored by organizations other than Digital. External
| Educational Assistance supports courses, seminars, conferences and
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External Educational Assistance
| programs that are identified in an employee's development plan and
| that meet: 1) short-term employee development goals that focus on
| current job assignments; or 2) long-term learning objectives that
| meet a Digital business requirement.
| PRACTICES:
| MANAGER RESPONSIBILITIES
| A manager is responsible for:
| - evaluating and balancing the goals of the Company and the
| aspirations of her/his employees;
| - appropriately managing and allocating funding for External
| Educational Assistance for her/his employees;
| - guaranteeing that employees have a written development plan
| that ties External Educational Assistance to: identified
| current organizational or individual business goals; or the
| acquisition of skills, knowledge or competencies that a
| business unit or a functional manager has confirmed are
| necessary for future business success;
| - ensuring that an employee's formalized development plan
| balances both business and individual goals;
| - accurately tracking employees' year-to-date External
| Educational Assistance spending;
| - guaranteeing that all outstanding costs, grades and
| procedures are closed within 60 days of completion; and
| - obtaining the next level of management's approval for a
| course, seminar or conference that costs in excess of $2,000.
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External Educational Assistance
| When approving an employee's request for External Educational
| Assistance, the manager is accountable for this financial
| investment by the Company. A manager must take into account
| business goals, employee goals and issues of affordability when
| evaluating a request for External Educational Assistance.
| When an employee leaves Digital, the manager is responsible for
| ensuring that all outstanding EEA payments are clearly identified
| on the "Termination/Retirement Information Form."
| EMPLOYEE RESPONSIBILITIES
| An employee needs to work with her/his manager to:
| - identify a course, seminar, conference or program's
| relationship to current or future business goals and the
| employee's approved development plan;
| - fill out the appropriate administrative forms prior to
| beginning a course, seminar, conference or program; and
| - complete all procedural requirements (including submitting
| final grades and receipts) within 60 days of completion.
| APPROVAL OF COURSES, SEMINARS, CONFERENCES AND NON-CREDIT COURSES
| An employee must meet all applicable eligibility requirements noted
| in the "External Educational Assistance Categories" section of this
| policy to receive External Educational Assistance. The
| determination of whether a course, seminar or conference is Job
| Required or Career Related, and the identification of the
| appropriate tax status, is the responsibility of the employee's
| manager. When a course, seminar, or conference costs more than
| $2,000, two levels of management approval must be obtained.
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External Educational Assistance
| For an employee to be eligible to receive External Educational
| Assistance funds to participate in a seminar, conference or other
| non-credit course, the learning experience must be Job Required (as
| defined in the "External Educational Assistance Categories" section
| of this policy). External Educational Assistance funds only cover
| seminars, conferences and other non-credit courses that are
| primarily a learning experience for an employee. When an
| employee's primary responsibility for attending a seminar or
| conference is to represent Digital, External Educational Assistance
| funds should not be used for this purpose. When Digital offers an
| internal education or training program that is substantially
| similar in content, accessibility and cost to an external
| non-credit course, seminar or conference, employees must enroll in
| the Digital program.
| Some examples of why External Educational Assistance may not be
| approved are: no substantial current or future business need has
| been identified; issues of affordability; the employee does not
| have a current development plan; final settlement is still pending
| 60 days after the completion of a course, seminar, conference or
| program; or the employee does not meet other eligibility
| requirements noted in this policy.
| If business requirements, the employee's job or the employee's
| manager change, this could affect the previous approval of a
| course, seminar, conference or degree program. In these instances,
| managers would be expected to evaluate educational needs as noted
| in the "Manager Responsibilities" section of this policy.
| EXTERNAL EDUCATIONAL ASSISTANCE CATEGORIES
| Digital provides eligible employees with two types of External
| Educational Assistance: Job Required and Career Related. The need
| to identify these two types of External Educational Assistance is
| due to different eligibility requirements. It is important to note
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External Educational Assistance
| that the required tax status determination, as defined by the IRS,
| has no relationship to whether a course, seminar, or conference is
| Job Required or Career Related, as defined by Digital (see the "Tax
| Implications" section of this policy for further details).
| Job Required:
| Job Required courses, seminars and conferences are defined as
| providing skills, abilities and knowledge that are necessary for an
| employee's current area of responsibility. Job Required courses
| are normally taken during working hours and are tied to a written
| development plan. The exception is if a course is only offered in
| the evening. The determination of whether a course, seminar or
| conference is Job Required is made by the employee's manager.
| Eligibility: All Regular Active (R01-R40) and Regular On-Call
| (O00) Digital employees are eligible to apply for Job Required
| External Educational Assistance.
| Career Related:
| Courses or programs that are defined as Career Related are to
| prepare the employee for a Digital job or career opportunity and
| must be:
| - tied to a written development plan that is approved by the
| employee's manager;
| - taken at an accredited college or university with academic
| credit(s) being received by the employee (unless audit status
| is approved by the manager; see "Auditing A Course"); and
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External Educational Assistance
| - related to a current or future occupational Company need that
| is substantial enough to warrant the investment by Digital.
| Eligibility: All Regular Active (R20-R40) Digital employees who
| have a current performance/salary rating of 1, 2, or 3 are eligible
| to apply for Career Related External Educational Assistance.
| PAYMENT, FINAL SETTLEMENT AND TAX IMPLICATIONS
| Payment:
| Payment is requested by an employee for an approved External
| Educational Assistance course, seminar, conference or program by
| completing the Application for External Educational Assistance
| prior to the start date. Payments for approved Job Required or
| Career Related endeavors are made to employees through Employee
| Disbursements Processing Units prior to a course, seminar or
| conference beginning.
| Upon termination, if an employee has an outstanding EEA advance and
| has not started the course, seminar or conference, she/he is
| expected to reimburse Digital for this cost (see Personnel Policy
| 6.01).
| Level of financial support for approved courses: Digital will
| support 100% of normal tuition costs. Registration, lab and book
| fees are also covered at 100%, and are reimbursed via an
| Expense/Miscellaneous Voucher (see the back of the Application For
| External Educational Assistance form for a listing of costs
| covered). External Educational Assistance does not cover
| application fees, entrance exams, entrance exam preparatory
| courses, graduation fees or other costs that are not mandated to
| participate in a course, seminar or conference (e.g., health
| insurance, optional course materials and site fees). For Job
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External Educational Assistance
| Required courses, seminars and conferences, reasonable travel
| expenses should be considered (see Personnel Policies 3.23 and
| 5.11).
| Final Settlement:
| Within 60 days after successfully completing a course, an employee
| must submit to her/his manager the grade and receipts from the
| institution. For seminars and conferences, an employee must submit
| proof of payment. Managers are responsible for tracking this
| process with their employees.
| Employees are responsible for reimbursing Digital in full and
| within 30 days for any course receiving an "Unsatisfactory" (as
| defined by the granting institution), "Incomplete" or "Withdrawal"
| grade status. Employees are expected to reimburse Digital through
| Employee Disbursements Processing Units.
| Tax Implications:
| Under certain circumstances Digital's payments for courses will be
| taxable to employees. In such cases, Digital is obligated by law
| to report income and withhold taxes. Therefore, managers have the
| following responsibilities:
| 1. Answer the taxability questions in the Tax Status section of
| the Application for External Educational Assistance.
| 2. Track all taxable courses on a calendar year basis by
| completing and retaining a copy of the Application For
| External Educational Assistance.
| The determination of taxability is distinct from the policy
| determination of Job Required or Career Related. Taxability is
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External Educational Assistance
| determined from two questions that appear in the Tax Status section
| of the Application for External Educational Assistance. If either
| question is answered "yes," then the course is a taxable course.
| However, at certain times taxable courses are not taxed due to the
| operation of Section 127 of the Internal Revenue Code. When in
| effect, Section 127 exempts $5,250 of taxable course payments from
| taxation per year. Section 127 expired on June 30, 1992, but may
| be reinstated at some future time.
| Determination of Taxability: The following information is designed
| to help managers and employees determine whether a course is
| taxable.
| A course is taxable if either of the following (A or B) is answered
| "yes":
| A. Is this course required to satisfy the minimum educational
| requirements of the employee's current job?
| This means that if the employee accepted a job that had a minimal
| educational requirement (e.g., High School Diploma, Bachelors
| Degree) that the employee had not met, but had agreed to pursue,
| the course taken would be taxable.
| For example, a person is hired to fill an accounting position which
| requires a degree in accounting. This person is currently taking
| courses to complete her/his degree and was hired with this in
| consideration. These courses are needed in order for the
| individual to meet the minimum educational requirements for the
| position, and, therefore, the reimbursements for these courses are
| taxable.
| If an employee met the minimum educational requirements when she/he
| started the current job, but the educational requirements later
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External Educational Assistance
| changed and the employee needed to take courses to meet the new
| requirements, those courses would not be taxable.
| B. Does this course or degree program prepare the employee for a
| position within a new trade or business?
| In general, a course or degree program which prepares an individual
| for a new trade, business or career will be taxable. The course or
| degree program is taxable even if the employee has no intention of
| pursuing the new career either inside or outside Digital. On the
| other hand, if the education merely enables the employee to change
| duties or obtain a promotion within the same field of work or
| career without qualifying the employee for a new trade, business or
| career, the education will not be taxable. In general, engineering
| is a trade or business, so an employee with an engineering degree
| working as an engineer will not be taxed on courses which maintain
| or improve his/her present skills. On the other hand, a technician
| without an engineering degree generally would be taxed on
| engineering courses.
| Additional examples: A secretary who needs to improve writing
| skills takes a professional communications course at a local
| university. This course would enhance secretarial skills, but
| would not qualify the individual for a new career, trade or
| business. Question B would be answered "no." Someone who
| progresses from a personnel assistant to a personnel consultant and
| finally to a personnel manager does not change her/his trade or
| business, and again question B would be answered "no."
| The new trade or business test is difficult to apply to individuals
| pursuing an M.B.A. degree. An M.B.A. degree may not qualify an
| individual for a new profession, but an inquiry must still be made
| as to whether the individual will be qualified to perform new
| duties which are not within the same general type of work as are
| involved in her/his present employment. It is important to look at
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External Educational Assistance
| each course individually and not at the degree program as a whole
| when making the evaluation. An individual pursuing a finance
| career is probably not qualifying for a new trade or business when
| she/he takes courses in finance. However, this individual may
| qualify for a new trade or business if she/he takes courses in
| management or in some other field of concentration within an M.B.A.
| program which are not directly related to her/his current general
| duties. Training Expense Data: Managers must track training expense data
| so that employees may take full advantage of Section 127. When in
| effect, Section 127 exempts $5,250 of company payments for taxable
| courses from taxation per year. Digital does not have to report
| such payments as income to employees or withhold taxes. Any
| External Educational Assistance in excess of this $5,250 is subject
| to income and withholding tax. Since 1991, both undergraduate and
| graduate level courses have been treated the same way under Section
| 127.
| When Section 127 is not in effect, managers must continue to track
| the training expense data because Congress might reinstate the
| section retroactively. Accurate records are essential to ensure
| correct tax treatment of all course payments during a year in which
| Section 127 is reinstated. Consult with Personnel regarding the
| current status of Section 127.
| DEGREE PROGRAMS
| A manager must first determine if a degree program meets Digital's
| Career Related criteria (see External Educational Assistance
| Categories). If the degree program is approved, all courses
| contributing to the degree will be funded by Digital. Whenever
| possible, elective courses should simultaneously meet a degree
| requirement and have value to Digital.
| It is important to note that each course within an approved degree
| program must be identified as either Job Required or Career
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External Educational Assistance
| Related. An Application for External Educational Assistance must
| be completed for each course included in a degree program.
| AUDITING A COURSE
| Digital supports an employee auditing a course (as opposed to
| taking a course for academic credit) only when such a course is Job
| Required. Audited courses must be taken at an accredited college
| or university or at media-based programs offered at various Digital
| locations. At the end of a course, an employee must submit to
| her/his manager a confirmation that she/he was enrolled and
| participated in the course.
| GRADES
| Employees registered for courses taken at colleges and other
| institutions must obtain a grade that the granting institution
| defines as satisfactorily completing a course for credit. This
| grade must be submitted to the employee's manager no later than 60
| days following the completion of the course along with all
| necessary documentation to ensure final settlement.
| NUMBER OF COURSES
| There is no specified number of courses that an employee may take
| simultaneously. The manager and employee need to determine what is
| reasonable and necessary so that the employee can remain maximally
| productive in her/his current job. As a general guideline, an
| employee should not take more than two courses simultaneously.
| However, a manager must take into account business goals, employee
| goals, and issues of affordability when evaluating a request for
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External Educational Assistance
| External Educational Assistance. The frequency and number of
| courses may vary depending on:
| - the employee's job, development needs, and the appropriateness
| of specific courses for meeting those needs.
| - the employee who is in a field where functional or technical
| knowledge changes rapidly, and Digital requires such knowledge.
| - the need to fill critical work force skills.
| CREDIT BY EXAMINATION
| Digital will support the costs for challenge or equivalency
| examinations for courses normally taken as part of an approved
| degree program at an accredited institution. These examinations
| include the College Level Examination Program (CLEP), as well as
| other examinations used by accredited institutions.
| Digital supports employees who want to obtain a high school
| equivalency diploma through programs and/or required examinations
| that are approved by the Department of Education of the state in
| which the exam is given.
| The procedure for receiving External Educational Assistance for
| Credit By Examination is the same as for any other approved course.
| A grade or test score does not have to be submitted, but the
| granting institution must certify that the examination has been
| completed by the employee.
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External Educational Assistance
| COURSE QUALITY
| Digital is a corporation comprised of individuals who have diverse
| educational and training needs and goals. As a result, the types
| of education and training programs for which employees request
| External Educational Assistance can vary.
| Employees and their managers are strongly encouraged to review the
| content and methods that will be used prior to the start of a
| course, seminar, conference or program. Occasionally, employees
| may find that they are being exposed to materials or exercises that
| they believe are offensive to them. In such cases, employees
| should immediately notify their manager and Personnel to determine
| the course of action.
| Digital will only support university and college level courses that
| meet certain accreditation standards. In the United States,
| courses (including correspondence courses) given by a college,
| university, trade or technical school must be accredited in order
| for an employee to receive External Educational Assistance.
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