Confronted by atight labor market and ever more indebted applicants, about 4percent of big companies surveyed by SHRM say they're helping theiremployees repay their loans with cash payments. (Photo:Shutterstock)

Starting next year, U.S. employees at insurance company UnumGroup will have a choice: The company will put money toward theirstudent loans, if the worker gives up fivepaid vacation days.

The new perk is a creative twist on an increasingly popularbenefit. Confronted by a tight labor market and ever more indebtedapplicants, about 4 percent of big companies surveyed by theSociety for Human Resources Management say they're helping theiremployees repay their loans with cash payments of up to $250 amonth.

Related: IRS opens door for 401(k) sponsors to addressstudent loan debt

The deal for Unum's 8,500 workers, though, is different: Cashfor debt in exchange for unused vacation days. Each day is worth anemployee's hourly rate for an eight-hour day. Parents who shareresponsibility for a child's loans also qualify to cash in.

“We thought it was a more creative method,” said Carl Gagnon,who runs financial well-being programs at the Chattanooga-basedinsurer.

Unum estimates that around 30 percent of its U.S. workforce willtake advantage of the benefit. On average, Unum employees carry$32,000 in debt, with payments of $350 a month, according to thecompany's internal research. How much workers can earn for theirvacation days depends on their salary, but the company estimates anaverage of about $1,200 a year.

Jimmy Valentine, a 30-year-old employee at Unum with $22,000 indebt, said he plans to cash in the maximum amount of vacation daysevery year until his loans are paid off. Like most Americans, hedoesn't use all of his vacation days, and with the benefit, he canapply an additional $1,120 a year to his debt. “I should take moredays off,” he said. “But I continue to work to make sure I keep upwith everything.”

A recent viral Buzzfeed essay pointed to long hours, low wagesand high debt burdens as a triple albatross for millennials, butGagnon doesn't think the company's posing an unfair choice. Unumemployees get at least 28 days of paid time off, nearly double the15 paid days the average U.S. worker gets, according to the Bureauof Labor Statistics.

“Giving up five, that gives people ample time,” Gagnon said. “Itoffers choice.”

Read more:

• Student loan benefits more popular with workersthan employers
• Student loan debt harms retirement, saysAARP
• 10 states with the highest average student loandebt

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