Chegg, an online learning service, announced Thursday that it was launching an equity program to help its employees pay off their student loans.
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“Under the Equity for Education program, Chegg has created an equity pool from their existing pool of stock which will be used to pay down U.S. employees' educational loans,” the company said in a statement.
Chegg took the initiative and called on politicians in Washington, D.C. to support similar programs. The company said other companies should follow suit on their model for its employees.
"We realize the amount of debt that is taken on to pursue higher education is crushing our students, hurting families, and our economy, and we want to make an impact on the problem now. We are announcing our Equity for Education plan because we want to encourage other companies to create similar programs for their employees," Dan Rosensweig, the CEO and president of Chegg, said in a statement. "The student debt statistics are daunting, and we believe it's going to take a village to solve this problem."
Rosensweig said he believed the program would “ultimately benefit the company.”
“We believe that young Americans and their families deserve the opportunity to advance their lives through education,” he said.
The program would apply to any American employee working for the learning platform with student debt. Those who have worked at Chegg for two years will get up to $5,000 a year. Those who are at a director or vice president level can receive up to $3,000 a year.
"These new equity grants are in addition to the $1,000 cash that employees with student debt already receive each year from Chegg," Jenny Brandemuehl, Chief People Officer of Chegg, said in a statement. "We believe that learning is a lifelong pursuit, which is why we also provide an additional $5,250 non-taxed reimbursement to every Chegg employee for continuing education, so they can continue to invest in their future."
Outstanding student loan debt hit $1.46 trillion at the end of last year, according to data from the Federal Reserve Bank of New York, second only to mortgage debt as a share of Americans’ total debt burdens. Data from Deutsche Bank Research found most people have student debt balances between $10,000 and $25,000. However, in some areas of the country, the amounts are higher, including in the states of New Hampshire, Minnesota, Pennsylvania and Rhode Island.
Fox Business’ Brittany De Lea contributed to this report.