Dave Regnery knows what it’s like to juggle work and school. Earlier in his career, the chair and CEO of Trane Technologies decided to earn an MBA. That took a while.
“It was extremely difficult for me to be able to come up with the funds so that I could get reimbursed later,” recalls Regnery, who leads one of the world’s top HVAC (heating, ventilation, and air conditioning) companies. So he paid for one class at a time rather than two.
Trane’s 30,000 North American employees have no such worry. Last year under Regnery, who became CEO in 2021, the company switched from reimbursing people for school to giving them the money up front. The Tuition Assistance Program is part of Trane’s focus on upskilling and reskilling, an effort that has helped build trust with employees.
In addition to college degrees, the revamped program covers technical certifications like HVAC and building automation technology. “The reason why that’s so important is because many people, especially at the line level, may not have the funds available to pay for the initial cost of going to school and then wait for the reimbursement,” Regnery tells me from Davidson, N.C.
The CEO, who’s spent his entire career at what is now Trane since starting there as a trainee, made the shift based on employee feedback. When Regnery visits one of the company’s plants, he likes to chat with line workers. One told him they wished they could go back to school and become an electrician.
With his team, Regnery determined that the benefits of advancing tuition far outweighed the financial risks. “Our employees are learning skills that they never thought they were going to have the opportunity to learn,” he says. “And they’re making better lives for their families, and we’re better off as Trane Technologies.”
In 2023, almost 730 Trane employees took advantage of tuition support—a roughly 40% jump from the previous year. “My bet is it will go up another 40% in 2024,” Regnery says.
With service technicians in high demand throughout the HVAC industry, Trane also runs a national Technician Apprenticeship Program accredited by the Department of Labor. The four-year program, which consists of about 80% newcomers to Trane, has a retention rate of more than 95%, Regnery notes. Launched early last year, it’s grown to 200 apprentices and is heading to 400.
“This is starting to churn,” Regnery says. “Sure, it’s expensive to run the program, but the benefit that we’ll receive down the road, the returns will be fantastic.”
To further emphasize skills and attract the people it wants, Trane has eliminated degree requirements for roughly 50 job categories. Among them: sales and account manager, plant supervisor, and test stand engineer.
Trane began revisiting academic qualifications in the tight pandemic labor market, Regnery explains. As a member of One Ten , he also heard former IBM chief executive Ginni Rometty talk about skills-first hiring.
“I think when people wrote job descriptions, they would just say, ‘four-year degree,’” Regnery observes. “We were putting these requirements on there that were just way overqualified for what we were looking for.”
Regnery has seen the Tuition Assistance Program build trust between Trane and its employees. “I’m going to give you those funds up front, and then I’m going to trust that you’re going to go to class, you’re going to get a great skill set, and you’re going to graduate,” he says. “When you start doing that, the trust goes both ways.”
He encourages other leaders to take a chance on their people. “Education has got the highest returns of any investment you’ll make in your company,” Regnery says. “If you can educate your workforce, you’re going to have a skilled workforce. They’re going to have a smile on their face, they’re going to have a great job, and that’s going to show up with your customers.”
A breath of fresh air.
Nick Rockel
nick.rockel@consultant.fortune.com
This story was originally featured on Fortune.com
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