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The Art Institute Of Pittsburgh – Online Division
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  1. The Art Institute Of Pittsburgh – Online Division Employee Handbook 420 Boulevard of the Allies, Pittsburgh, PA 15219

  2. Introduction General Information Pg. Organization Mission Statement 4 History of The Art Institute of Pgh. 5 Building Hours, Information & Security 6 General Policies Equal Employment Opportunity 6 Sexual Harassment 7 Non-Fraternization 8 Hours of Work 8 Employee Records 9 Employee Appearance 9 Employment And Promotion Employability Under Immigration Laws 9 Promotions From Within 9 Employee Relations Problem Solving 10 Drug Free Policy 11 Standards of Conduct 11 Compensation Pay Practices 12 Your Salary 12 Overtime 12 Leaves Of Absence Leaves 13 Medical 14 Family & Medical Leave 14 Personal 15 Military 15 Bereavement 15 Jury Duty 15 Employee Benefits Pg. Group Insurance 16 Disability Plans 17 Vacations 17 Holidays 18 Retirement Plan 18 ESPP 19 Tuition Grants 19 Tuition Reimbursement 20 Employee Purchases 21 COBRA 21 Training & Employee Development Performance Appraisal 21 Miscellaneous Information Safety 22 Telephones 22 Electronic and voice mail 22 Solicitation 22 Bulletin Boards 23 Mailroom 23 Smoking 23 Termination 23 Table of Contents i

  3. Introduction This handbook is provided for your use as a ready reference and as a summary of The Art Institute On line personnel policies, procedures, work guidelines and benefits. The handbook represents a general statement of policy and benefits and a general overview of the responsibilities and obligations of employees. You will find it to your advantage to read the entire handbook promptly, so that you will have a good overview of the material covered. All employees should read, understand and follow the provisions of this manual. Additional policies and practices relating to faculty employment are published in the Institute's Faculty handbook. All employees are hired for an unspecified duration and nothing in this employee handbook is meant to create an explicit or implicit employment contract. Employment is at the mutual consent of the employee and the Institute. Accordingly, either the Institute or the employee can sever the employment relationship at will, at any time, with or without cause or advance notice. No manager or representative other than the President has the authority to enter into oral contracts of employment of any kind. It is obviously not possible to anticipate every situation that may arise in the work place or to provide information that answers every possible question. In addition, circumstances will undoubtedly require that our policies, practices and benefits change from time to time. Accordingly, the Board of Directors and the Institute reserve the right to modify, supplement, rescind or revise any provisions of this manual as they deem necessary or appropriate in their discretion. No modification shall change the at-will nature of employment with the Institute. As policies and benefits are revised, however, updated pages will be distributed to you for insertion in this handbook. The Institute is constantly striving to improve its personnel policies and the services that it provides to its students. If you feel there is something useful that should be added, or if you have any suggestions for improvement, please forward your comments to your Department Director or any member of the Executive Committee. Your input will be welcomed. ii

  4. General Information The Art Institute Online Mission, Values and Vision Mission AiO is dedicated to extending the opportunity for learning to all students without geographic, lifestyle or physical constraints. We are equally dedicated to achieving student satisfaction and adding significant value to the organization. Our success will not be a matter of chance but of commitment to the core values that distinguish us. Values We work to the highest ethical standard, and strive to achieve a consistent culture of empowerment, fairness and trust. The high quality of our educational product, service to our customers and external and internal communications are the foundations of our business success. We provide an exceptional, learner-centered educational environment that ultimately seeks to provide every student the highest return on his or her educational investment. We acknowledge the commitment, dedication and loyalty of each employee; we believe that every job is essential and contributes to our success as a team. We value each team member’s creativity, participation and initiative in the decision-making process. Supporting employee growth, and maintaining an appropriate balance between the demands of our professional and personal lives, is key to the long-term success of each employee. We embrace and promote continuous growth and constructive change. 4

  5. Vision AiO will be an international leader in career-based, higher education design programs and professional development training, delivered exclusively online. A curriculum featuring outstanding instructional design, coupled with rich, interactive media will be our key differentiator.The Art Institute Online will have two functional divisions: Degree programs and CPD. AiO graduates are in demand and employed at 98% rate within 6 months of graduation. The students of The Art Institute Online graduate with high-quality portfolios and quickly obtain employment with the highest average salaries in the Art Institutes system. The Art Institute Online's technology infrastructure seamlessly supports all forms of online education and media, providing students and faculty with a high-usability interface 100% of the time, 24 hours per day, 7 days per week, 52 weeks per year. The AiO web site provides full service support for students; they can apply to school, register for classes and pay accounts on line. We will have an outstanding online student gallery showing off our student work, as well as a completely automated online customer support system. We will have broadened our audience to include not just adult working professionals, but also international students, all college-age students, some high school students and teachers, home school parents and students and rural communities at large. Strategic partnerships will be one important key to our success. We will create partnerships with several other technology leaders and business partners.The on ground schools will have quickly integrated the best of the online techniques into their existing curricula. Ai students will move freely between the online and on ground environments. Most on ground classes will have an online component, with selected classes only offered online. All on ground schools use online preparatory or remedial training. The Art Institute Online enrolls 10%-15% of all the students in the Art Institute system in its courses. The placement operation in the on ground schools have centralized and organized to provide national support for all students. AiO provides national placement capability.

  6. History of The Art Institute of Pittsburgh The Art Institute of Pittsburgh was founded in 1921 as the Artists League of Pittsburgh. The first commercial art school east of Chicago began classes in a 500 square foot space in the Fulton Building. A single instructor taught nine students drawing, painting, lettering and cartooning. In 1930, the school's name was changed to The Art Institute of Pittsburgh. The student body had grown to 500 students enrolled in Commercial Art and Fashion Illustration diploma programs. During its first decade, the school had moved four times and was now located on Stanwix Street directly across from Joseph Horne Co. Barely surviving the depression, the Institute flourished in the forties and fifties primarily due to the large number of veterans who opted to pursue an education in commercial art. By 1945, the Institute occupied an 8-story building on Smithfield Street and served 1700 students from 40 states and 5 countries. Interior Design, Dressmaking, Millinery Design and Photography were offered in addition to the original curricula in both day and evening classes. During the sixties, enrollment remained at a level of 600-700 students until 1969 when the Institute became affiliated with Education Management Corporation. In the 1970's, the Institute achieved accredited status with the National Association of Trade and Technical Schools, now recognized as The Accrediting Commission for Trade and Technical Schools of the Career College Association. Fashion Marketing was added to the school's academic majors, and all two-year programs were reviewed by the Pennsylvania Department of Education and approved to award the Associate Degree. A.I.P. began development of the College Affiliate Program, greatly expanded services to students and moved to its present location. By 1980, enrollment had reached 1500 students. Moderate growth continued through the 1980's until 1988-1989 when the Industrial Design Technology and Music and Video Business programs began and were approved for degree granting status. An increased effort to attract international students was initiated. Desktop Publishing was added in 1991 nearly doubling diploma program enrollment. In 1991, The Art Institute of Pittsburgh reached a record enrollment of 2600 students. In 1993, the Institute developed and secured approval from the State Board of Private Licensed Schools to offer programs in Computer Animation/Multimedia and Artisan Technology. In 1995 AIP was approved to offer the Video Production program. AIP constantly strives to offer programs that are state- of- the- industry. The most consistent statistic throughout A.I.P.'s history is the exceptional achievements of its graduates. Studies over the years indicate that 80 - 95% of graduates are placed in field-related positions within nine months of graduation. Even in the current economic climate, graduates of The Art Institute of Pittsburgh continue to compete successfully in the marketplace. 5

  7. Building And Information Security The main entrance of The Art Institute is attended by security guards during hours of operation . Guards are responsible for ensuring that persons entering the building are students, members of their families, faculty, staff or invited guests.Students, staff and faculty should be prepared to show identification to enter the building. The unarmed security personnel may not make arrests but will promptly contact the city police if and when illegal activity occurs. General Policies Equal Employment Opportunity The Art Institute Online believes that all persons are entitled to equal employment opportunity and does not discriminate against its employees or applicants because of race, color, religion, sex, sexual orientation, age, national origin, disability, or on any other basis prohibited by law. The Institute's policy of nondiscrimination applies to all levels of employment and all personnel practices, including recruitment, hiring, upgrading, demotion, compensation, benefits, transfer, layoff, termination, training and educational, social, and recreational programs. All supervisors are responsible for adhering to and implementing the provisions of this policy. 6

  8. Sexual Harassment • The Art Institute Online is committed to providing a work place and educational programs and activities for employees, faculty, students and applicants for admission which are free from sexual harassment. Sexual harassment in any manner or form is expressly prohibited. All claims of sexual harassment are to be promptly and thoroughly investigated, and appropriate action will be taken, based upon the results of the investigation. • A. Definition • Sexual harassment consists of unwelcome sexual advances, requests for sexual favors, or other verbal or physical conduct of a sexual nature directed toward an employee, student or applicant for admission where: • (1) Submission to the conduct is an explicit or implicit term or condition of either employment or a person's status in a course, program or activity, or in admission or in an academic decision; or • (2) Submission to or rejection of the conduct is used as the basis for academic or employment decisions; or • (3) The conduct has the purpose or affect of unreasonably interfering with an individual's work or academic performance or creating an intimidating, hostile or offensive work environment. • B. Problem Resolution • Employees, students or other individuals who feel that they have been sexually harassed have several ways to make their concerns known. If the employee feels that it is appropriate they can tell the harasser to stop. They also may talk with anyone of the Sexual Harassment Board of Advisors for guidance to make an informal complaint. If the informal complaint procedure fails to satisfy, the employee should make a formal complaint in writing to one of the Advisors. The Board of Advisors will respond in writing within thirty days. • Sexual Harassment Board of Advisors • Trudith Stroede VP Director of Operations • Office locations and telephone extensions can be found in the directory. • Every effort will be made to treat complaints with the utmost discretion. Information will be communicated on a "need to know" basis. While anonymity and confidentiality will be protected as much as possible, it cannot be guaranteed. 7

  9. Regardless of the method of resolution, a person who initiates a sexual harassment complaint will not be retaliated against, nor will initiation of complaint affect employment, compensation or work assignments for employees, or grades, class selection or other matters for students. • C. Responsibility for Implementation • All levels of administration and management are responsible for implementing this policy and helping to create an environment free of sexual harassment. Administrators, managers and supervisors who receive a sexual harassment complaint should bring it to the attention of the Director of Human Resources or a member of the Board of Advisors. The complaint and the details surrounding it should be documented. • Non-Fraternization • All employees are expected to conduct themselves in a professional manner that contributes to the proper educational, business and employment environment. Due to the inherently unequal relationship that exists between a faculty member and his or her students, or a manager and his or her subordinates, close social relationships can be problematic. Such relationships can easily degenerate into cases of sexual harassment, and the real or perceived problem of favoritism can seriously affect the educational or management process. • Accordingly, sexual relationships between faculty and students and staff and students are prohibited’ except in cases where a relationship has been established prior to the student or employee starting school or work. The employee should discuss those situations with the Human Resources Director. • Similarly, sexual relationships between a manager and his or her subordinates are also prohibited. • Violations of this policy may be brought to the attention of the appropriate Department Director or Director of Human Resources and may result in disciplinary action up to and including termination of employment. Such matters will be handled with discretion and in confidence. • Working Hours And Attendance • Full-time faculty are normally scheduled for 4 online classes per quarter and also have an additional amount of office hours. Assessment activities, lesson plans and class preparation are in addition to scheduled class time.Schedules vary from quarter to quarter based on course offerings and student body distribution. • The normal work week for full-time, non-exempt staff as defined in the overtime pay section of this handbook is 40 hours per week. Scheduled work hours and work days may vary slightly from department to department. The school operates 7 days per week. Classes are held and offices are open at various schedules. • Various factors, such as work loads, client service and staffing needs may require variations in an employee's actual hours of work. Some employees may be required to work extra time or hours other than those normally scheduled as necessary. 8

  10. As part of our responsibility to our clients, the public and to other employees, employees are expected to be at work as scheduled, to arrange personal schedules to accommodate our established working hours and to notify their supervisors as soon as possible if they expect to be absent or tardy. Changes Of Employee Personal Information It is the employee's responsibility to report changes of address, telephone number, name, beneficiary or emergency contact. Employees who have dependent medical coverage should notify the Institute if their marital status or number of dependents changes in order to administer benefits properly. Any changes should be reported to the Human Resources Department within 30 days. Personal Appearance In the interests of presenting a professional image to our clients, we ask that employees observe good habits of grooming and appearance. Please dress conservatively, in good taste, and in keeping with the requirements of your position. More specific information on proper dress and appearance is available through the Institute's Department Directors. Employment And Promotion Employability Under Immigration Laws The Immigration Reform and Control Act of 1986 provides that only American citizens and aliens who are authorized to work in the United States may be hired. An Employment Eligibility Verification Form, (I-9), must be completed by all persons hired after November 6, 1986. Promotion From Within The Institute encourages employees to apply for promotions for which they are qualified. Open positions are posted on the intranet and bulletin boards. It is advised that you talk directly with your supervisor prior to applying for another position. 9

  11. The practice of announcing vacancies gives interested employees an opportunity to apply for consideration. It is important to remember that simply applying for the position does not automatically qualify an employee; there may be other more qualified candidates from within or outside the Institute. • The employee's qualifications, past performance, potential and capacity to assume increased responsibilities will be evaluated. Because of the nature of our business, it is suggested that you have been in your current position for one year before applying for another job within the school. • Staff employees who have the required skills, credentials and interest may apply to teach a class at the school. The class cannot interfere with the employee’s primary position and must have the approval of their supervisor. Two classes per quarter are the maximum that an employee may teach in addition to their primary job. • Employee Relations • Problem Solving Procedure • If there is something about your job that is bothering you or you feel that you have not been treated according to the Institute's policies, there is an established problem-solving procedure that should be used. The Institute is eager to learn of any condition that may be causing problems for you on the job, and will make every effort to resolve your problems. • First Step: Talk with your supervisor as soon as you become aware of the problem. Your supervisor is in the best position to address your concerns. • Second Step: If you feel that the problem is not solved to your satisfaction with your immediate supervisor, you may involve the Director of Human Resources by meeting in person or by submitting a written statement. You will be provided with a written answer to your complaint within ten days. • Third Step: If you still feel that the problem is not resolved to your satisfaction, you can request a meeting with the President of The Art Institute. Because the full responsibility for the operation of the Institute rests with the President, any decision rendered by this office must be regarded as final. 10

  12. Drug Prevention Policy The Art Institute Online has adopted and implemented a drug prevention policy which is designed to prevent the unlawful possession, use, or distribution of illicit drugs and alcohol by students and employees. The policy has been implemented in compliance with The Drug Free Schools and Communities Act Amendments of 1989, Public Law 101-226. All employees will receive a copy of the Institute's drug prevention policy and will be expected to comply. All employees are required to comply with the added certification provisions of the Drug Free Work Place Act. Standards Of Conduct Since the proper working relationship of all employees depends upon each of us, the Institute has established certain minimum standards of personal conduct. These "common sense" guidelines are included here for those who, through lack of understanding or experience, could experience difficulties. Examples of impermissible conduct that may lead to disciplinary action are identified below to promote understanding of what is considered unacceptable conduct and to encourage consistent action by the Institute. The following list contains some examples of conduct that may lead to the imposition of discipline, including possible termination: excessive or unexcused absenteeism and tardiness; theft; use or possession of illegal drugs or alcohol in violation of our published policy; being under the influence of alcohol while at work; possession of firearms; unsafe acts; violations of privacy or confidentiality; carelessness or negligence; harassment, including sexual harassment; insubordination; and unsatisfactory performance. The preceding list is not meant to be all inclusive, but is only a representative sample of the types of prohibited behavior. 11

  13. Compensation Pay Practices Education Management offers pay by Direct Deposit into your bank account. You will receive a deposit advice slip which details your pay for the period. Your pay may also be available by check, but direct deposit is the company’s preferred method of payment. Direct deposit not only saves you time, but eliminates the risk of a lost paycheck. All paychecks and paystubs are mailed from our corporate payroll department to your home address. In the event that a paycheck does not arrive on time or is lost, it will take at least two( 2) weeks to stop payment and reissue the check. Certain deductions which are required by law will be withheld from your pay. These include state, federal and local taxes, and social security taxes . Other deductions may be made from your pay only with your written permission, including: insurance premiums for your dependents and voluntary retirement plan contributions. Covenants of our Employee Stock Ownership Plan prohibit credit extension or salary advances. Your Salary It is the policy of The Art Institute Online to maintain a compensation program that will permit the attraction and retention of high quality employees. The Institute strives to maintain salaries which are competitive in the area and are set to reflect the responsibility, performance and skills of each employee. Periodically, your salary will be reviewed to determine if an increase is warranted. Any increase will be based, most importantly, on your job performance. Many other things may be considered in determining salary increases, including your current salary compared to others in similar positions, time since last increase, and the internal and external economic situation. Your salary is confidential information and should not be discussed with anyone other than your supervisor, the Executive Committee member responsible for your area of operation, the President, or the Human Resource Director. Overtime Pay Employees may be required due to the needs of the business to work beyond their normally scheduled hours. Eligible employees who are required or permitted to work overtime will be paid in accordance with this policy. For purposes of overtime pay eligibility, employees are divided into two categories: exempt and non‑exempt. Exempt employees are those occupying positions not eligible for overtime pay; for example, Presidents, Executive Committee Members, Department Directors, (non-Admissions) Assistant Directors, Supervisors, Instructors and some other administrative and professional positions. Non‑exempt employees are those holding positions eligible for overtime pay. These categories are determined by actual job duties and responsibilities using specific criteria and are not simply determined on the basis of job title. You will be advised of your eligibility for overtime pay. 12

  14. Overtime Pay • Eligible employees who work more than their regular work week will be compensated at the rate of one and one half times their regular rate of pay for all hours worked in excess of 40. Assistant Directors of Admissions are compensated at one times their regular rate of pay for all hours worked in excess of 40. • Authorization for Overtime Pay • All overtime worked by non‑exempt employees must be approved in advance by their supervisor. Unauthorized overtime is against company policy and employees who violate this policy are subject to discipline. • Recording Time Worked • All non‑exempt employees must accurately complete a "time record" each month. Both the employee and his or her supervisor must sign the form verifying the hours worked. The form will then be used to authorize any overtime payments that will be paid during the next scheduled pay period. If you are required to complete a time record, the form will be provided to you. • Leaves Of Absence • Leaves of absence will be considered in cases of medical disability and for compelling personal reasons, military duty, jury duty, bereavement, or on any other basis as provided for by law. Unless specifically provided otherwise, all leaves of absence are available only on an unpaid basis. In the case of family or medical leave, however, paid leave time (sick leave, accrued vacation, personal leave and disability leave) will be substituted where the leave satisfies the terms of the paid leave plan. • Subject to any applicable legal restrictions, requests for leaves of absence will be considered on the basis of the employee's length of service, performance, responsibility level, the reason for the request, and the Institute's ability to satisfactorily replace the employee during the leave. • When an employee is placed on leave of absence for reasons other than those applicable to family and medical leave, an effort will be made to hold the employee's position open for the period of the approved leave. However, due to operating needs, there will be times when positions cannot be held open. Accordingly, it is not possible to guarantee reinstatement, except where legally required to do so. • It is the employee's responsibility to notify the Institute of his/her intention to return to work following the expiration of an approved leave. If an employee's former position is unavailable when he/she is ready to return from an approved leave, every effort will be made to place the employee in a comparable position for which he or she is qualified. If such a position is not available, the employee will be offered the next available position for which the employee is qualified. When an employee returns from a family or medical leave, he or she will be restored to the position held at the start of the leave, or to an equivalent position with equivalent pay, benefits and other terms and conditions of employment. When necessary to protect the operations of the company, it may be impossible to reinstate certain highly-paid key employees following the use of family or medical leave. 13

  15. An employee who does not accept a position offered, who accepts other employment during the leave, or fails to return to work on the next scheduled work day following the expiration of the leave, will be considered to have voluntarily terminated. Misrepresenting the reasons for applying for a leave of absence may result in disciplinary action. • Listed below is general information regarding certain types of leave. Other types of leave may be available. More detailed information will be provided to you by the Institute's benefits representative. • Medical Leaves • A medical leave of absence may be granted for an employee who is temporarily disabled and unable to work due to a non-occupational illness or injury, including a pregnancy-related disability. A medical leave of absence will be granted for the duration of the disability. All requests must be substantiated by an attending physician's statement. A request for an extension of the leave that is not due to medical disability will be considered a personal leave. • Group health insurance benefits and life insurance will be continued during the period of the medical leave on the same cost basis as active employment. Participation in the Retirement Plan and the Employee Stock Ownership Plan will be according to the respective plans. • Pay for eligible employees will be provided in accordance with the Income Protection Plans in effect, as described in the Group Insurance section of your handbook and the applicable Summary Plan Descriptions. • Family and Medical Leave • Eligible employees are entitled to up to a total of twelve work weeks of leave during a 12-month period for one or more of the following reasons: • ~the birth of a child; • ~the placement of a child for adoption or foster care; • ~to care for a spouse, child or parent who has a serious health condition; or • ~a serious health condition of the employee. • The amount of leave entitlement depends upon an employee meeting the necessary eligibility requirements • and his or her regular work schedule. Entitlement applies equally to male and female employees. • The Institute will maintain coverage under all group health plans (medical, dental and/or vision) for the duration of the leave at the level and under the conditions coverage would have been provided if the employee had continued employment. Life and long-term disability coverage may be continued to the extent permitted by the insurance carrier. Participation in the Retirement Plan and the Employee Stock Ownership Plan will be according to the respective plans. • Paid leave time (sick leave, accrued vacation, personal leave and disability leave) will be substituted where the family or medical leave satisfies the terms of the paid leave plan. • Employees requesting leave must furnish notice to the Institute 30 days in advance of the leave, or as soon as practicable. Leave requests for the employee's own serious illness must also be substantiated by an 14

  16. Attending Physician's Statement. For planned medical treatment, employees must make a reasonable attempt to schedule treatment so as not to unduly disrupt the operations of the company. A request for an extension of a leave that is not due to medical disability will be considered a personal leave. Miscellaneous Personal Leave A leave of absence for compelling personal reasons may be granted, without pay, for up to thirty (30) days at the discretion of the Institute President. Any extensions due to special circumstances also require the express approval of the President. Requests must be submitted in writing as early as possible before the leave is to begin. It is the employee's responsibility to report to work at the end of an approved leave. Premiums for benefits are the responsibility of the employee during a personal leave. Accordingly, employees who wish to continue their benefits during a personal leave must pay their premiums in a timely manner. Military Leave Military leaves of absence are granted only with written verification from the appropriate military authority. The School will reinstate employees returning from a military leave in accordance with "The Veteran's Reemployment Rights Act", and other applicable laws. Employees who are required, as members of the National Guard or a Reserve unit, to attend a training period not exceeding two weeks plus required travel time, will be paid the difference between their normal compensation and the pay they receive while on military duty, less travel allowance. Employees who enlist, or are inducted or ordered to active duty to fulfill their reserve obligations, or who are ordered to active duty in connection with reserve activities for indefinite periods, or for periods in excess of their annual training are not eligible for leave with pay as outlined above. Institute provided benefits will be continued during military leaves not exceeding 30 calendar days. Bereavement Leave In the event of the death of an immediate family member (parent, sibling, spouse, or child) an employee will be granted a leave with pay for the time actually lost from regularly scheduled work on the day of the death, and the days following it, up to and including the day of the funeral, not to exceed three days. Under special circumstances, the supervisor may authorize the employee time off with pay to attend the funeral of a relative not listed above. In cases where considerable travel to and from the funeral is involved, the leave may be extended as appropriate to a maximum of five days. Jury Duty Employees called to jury duty will be provided with time off to fulfill their civic obligations. Employees should notify their supervisor immediately upon receiving notice from the court. Full-time employees will be paid their regular salary, less amounts received from the court. 15

  17. Employee Benefits • Group Insurance / Signature Benefits • The Company is pleased to offer a flexible benefits program, which means that each year you can build the specific benefits plan that is right for you using "flex credits" that the Company provides and, if necessary, your own salary dollars. The following benefit plans are provided as choices under our Signature Benefits Plan: • Signature Benefits Plan • ~ Group Medical Insurance and/or HMO's • ~ Group Dental Care Insurance • ~ Group Vision Care Insurance • ~ Additional Life and Accidental Death and Dismemberment Insurance • ~ Disability Insurance • ~ Health Care Flexible Spending Account • ~ Dependent Care Flexible Spending Account • Through Signature Benefits, full-time employees receive an allocation of flex credits which they may use, along with their own salary dollars if necessary, to buy a personalized package of benefits for themselves and their dependents. Part-time employees will not receive any flex credits, but may purchase a medical plan and participate in the two (2) Flexible Spending Accounts. Most benefits may be purchased using pre-tax dollars which offers substantially improved spending power. • Details of the programs described above, and instructions for enrollment will be provided to you by the Company's benefits representative. You are eligible to participate in the Company's benefits plans on the first day of the month following 30 days of employment. • Group Life Insurance Plan • Both full-time and part-time employees receive group life insurance at no cost. Full-time employees will receive insurance equal to two times their annual salary, rounded up to the next higher $1,000. You will also have an equal amount of accidental death and dismemberment (AD&D) insurance. Part-time employees will receive life and AD&D insurance of $15,000 regardless of salary. Employees may purchase additional coverage at one to three times their annual salary. The monthly cost for this additional life insurance depends upon your age, and prices will be available in your enrollment package. • Sick Days • The Institute provides protection against loss of income due to incidental absences due to illness or injury. Full-time employees are eligible for six paid work days of this benefit. These sick days may not be carried over from one year to the next, and will be coordinated with other disability programs described in this handbook. Sick days are only to be used for genuine illnesses and the Institute reserves the right to request 16

  18. a doctor's note to verify such absence. If, in the judgment of the department director, abuse of the sick pay benefit has occurred, he or she may determine that excessive sick days are unpaid. Consistent unexcused absenteeism may result in probation or termination. Personal Business Days Occasionally an employee encounters situations that they must take care of during normally scheduled work hours. The Institute grants two work days at the discretion of the Department Director for this purpose.* This benefit must be approved by your Department Director in advance. Short-Term Disability Plan Full-time employees are eligible to participate in the short-term disability plan at no cost. In the event of a disability, the short-term salary continuation plan pays 100% of your salary. Depending on your length of service, you may be eligible for a minimum of 10, up to a maximum of 130 paid days. Long-Term Disability Plan If you are disabled in excess of sixty (60) days or after you have used all of your STD days, you would be eligible for benefits under this plan if elected through flex benefits. You may purchase long- term disability coverage that continues your salary at either 50% or 66 2/3%. Your salary would continue at the percentage elected through your disability or until you reach age 65. The premiums of this coverage would be made through payroll deductions. Details of the programs described above will be provided to you by the Institute's Human Resource office. Vacations / Non-Faculty The Institute provides vacation benefits for eligible employees to promote rest and relaxation away from work. Full-time, non-faculty employees begin to accrue vacation benefits from their date of hire and may take vacation after their first six months employment. Our vacation year runs from July 1 to June 30, the same as our fiscal year. Full-time staff accrue vacation benefits as follows: Continuous Service Vacation Amount During first fiscal year of service Pro-rata share of 10 days (.83 days/month) Through five fiscal years of service 10 days (.83 days/month) After five fiscal years of service 15 days (1.25 days/month) Over ten fiscal years of service 20 days (1.66 days/month) 17

  19. Vacation accrued must be taken during that vacation year, and you may not receive payment in lieu of vacation. Unused vacation will be forfeited if it is not taken by June 30. Vacation is accrued on a monthly basis, and any vacation taken during a year that is not fully accrued is considered to be advanced. If you terminate your employment you will receive pay for any unused, accrued vacation, but you will also have any advanced vacation deducted from your final paycheck. If you terminate in good standing and then return to the Institute within one year, you will be credited with your prior continuous service for vacation purposes. • Vacations must be scheduled at least 30 days in advance with your supervisor. Some employees may not be able to schedule vacations during certain periods of time due to the requirements of the Institute, however, your supervisor will attempt to accommodate your request if in his/her judgment it will not interfere with the performance of your duties. • Vacations / Faculty • Full-time faculty receive up to 20 days paid vacation per year during breaks between quarters at the rate of up to one week vacation for each quarter of full-time instruction. Any exception must be requested in advance and in writing to the Dean of Education or Director of Human Resources. • Holidays • The Institute observes 12 paid holidays each year, 11 of which are pre-determined, and one "floater" that will be announced at the beginning of each year. Full-time employees are eligible for holiday pay. Part-time employees will be paid for holidays on which they would normally be scheduled to work. Holidays which fall within faculty vacation breaks are considered part of their vacation time. Our holidays are: • Independence Day Labor Day • Veterans Day Thanksgiving Day • Thanksgiving Friday Christmas Day • New Years Day Martin Luther King's Birthday President's Day Good Friday • Memorial Day Floater (To be Determined.) • Holidays falling on a Saturday will normally be observed the preceding Friday; those falling on a Sunday will normally be observed on the following Monday. Employees may substitute two religious holidays for any two of the school designated holidays. Depending on the nature of your specific responsibilities, you may be asked to work on some of the Institute's recognized holidays. In those situations you will be entitled to a compensatory day to be scheduled at the discretion of your supervisor. • Retirement Plan • Employees of the Company may participate in the Retirement Plan of Education Management Corporation highlighted below. • ~ The Plan helps you save for retirement in three ways: through your own payroll deductions, through matching contributions from EMC, and through discretionary year- end profit sharing contributions that the Company may make. 18

  20. ~ You decide how to invest your own account. You may choose among many funds, all available through Fidelity Investments, the largest private mutual fund company in the United States. • ~ Through automatic payroll deductions, you can contribute between 1% and 99% of your eligible pay on a pre-tax basis, up to the annual IRS dollar limit ($11,000 in 2002). You can change your contribution amount at any time by logging onto NetBenefits at www.401k.com or calling the Fidelity Retirement Benefits Line at 1-800-835-5092. • ~ Your account will grow tax-free until you withdraw your money. • ~ For the first 3% of compensation that you contribute, EDMC will equally match your contributions a dollar for each dollar you contribute. This is like earning a 100% return immediately. For the next 3%, EDMC will match $.50 on the dollar for each dollar you contribute. • ~ You may "borrow" money from your personal account during your employment, or even take a "hardship" withdrawal for specified reasons. • ~ You can receive the value of your account when you retire, terminate, or become permanently disabled. If you die before then, your beneficiary will receive the value of your account. • ~ You are eligible to contribute to the plan immediately and are eligible for the company match at the first enrollement following 900 hours of service. You are fully vested in the company’s contributions after only 3 years of service. • You will receive a statement of your retirement plan account each quarter. The Retirement Plan is designed to help you prepare financially for those leisure days later in life when you no longer receive a paycheck. A Summary Plan Description is provided to all eligible participants, and it should be consulted for more specific information about the Retirement Plan. • Employee Stock Purchase Plan • The Education Management Corporation Employee Stock Purchase Plan presents an employee with the opportunity to conveniently acquire stock ownership in EDMC at a discount through payroll deduction. The ESPP enables you to purchase shares of EDMC common stock at a 15% discount and no broker’s fee through payroll deduction.You may invest from 1% up to 5% of base pay. For more details see your Human Resources Director. • Art Institute Tuition Grants • The Art Institute Online will provide full-tuition grants for eligible employees and their immediate family members to attend courses at the Institute, on a space-available basis. Full-time employees are eligible for this benefit, for themselves and their immediate family members, immediately after one year of service. Part -time employees must complete one year of service to be eligible for this benefit. Eligibility also requires that the employee be employed at the beginning of each academic term in order to receive a grant for the term. 19

  21. Immediate family members include the spouse and children only. They may enroll in an Art Institute program on a part-time or full-time basis. Courses must be approved by the Director of Education who will assure that any course prerequisites are met. • Grants will include all tuition and enrollment fees, but not application fee, online course fee, supplies, kit or living expenses, which are the responsibility of the student. • In the event of an employee's death or disability, currently enrolled students will be permitted to continue through the completion of the course or curriculum. In the event the employee resigns or is terminated from the Company, the grant is void at the completion of the quarter in which the student is enrolled. • Scheduling is administered on a space-available basis. Specific Art Institute policies and procedures will apply to program participants. • Employees cannot attend classes during working hours. • Interested employees should submit a letter of request approved by his/her supervisor along with an Application and Enrollment Agreement, when applicable, to the Art Institute President. • Internal Revenue Service regulations in effect at the time of the grant will govern whether the grant's value is included as taxable income to the employee. The employee should inquire before any courses are undertaken to determine if withholding amounts should be changed. • In addition, extended family members of employees are eligible for a 25% tuition grant on any courses or programs offered by the Institute. Extended family members include the parents, sisters, brothers, nephews and nieces of eligible employees. Please see your Department Director or the Director of Human Resources for procedures for applying for this benefit. • Similar tuition grants are available for attendance at other Art Institutes around the country. See your benefits representative for more complete details on this program. • Tuition Assistance • The Art Institute will provide tuition reimbursement at the rate of 75% for eligible full-time employees and 50% for eligible part-time employees. To be eligible: • ~ full-time employees must have completed one year of service, part-time employees, two years; • ~ the course work will, in the judgment of the Department Director, enhance the employee's professional skills and knowledge and is relevant to his/her position; • ~ the grade earned is a C or better; • ~ the employee takes the course on his/her own time. 20

  22. Assistance will be awarded subject to satisfying the best overall interest of the Institute. This will be determined by priority and the economic conditions of the Institute. Reimbursement will be on an individual course basis; award for a particular course does not guarantee reimbursement for an entire degree program. This benefit is intended for the mutual benefit of AIP and its employees. Any participant in this program who resigns or whose employment with AIP is terminated for causes, other than for job performance reasons, will be required to repay any amounts received for courses that were begun during the 12 months preceding the termination date. Contact the Human Resources Director for details on the program. Employee Purchases You may purchase a variety of merchandise at a discount through the Institute Supply Store. The store carries a wide range of art and photographic equipment as well as office supplies. See the store manager for further details of the Employee Purchase Program. COBRA The Consolidated Omnibus Reconciliation Act of 1985, or COBRA, requires an employer to offer continuation coverage under a group health plan to employees and their spouses and dependent children who lose coverage because of certain qualifying events. These events include: the employee's termination of employment; reduction in hours of employment which results in loss of benefit coverage; death, divorce or legal separation; entitlement to Medicare; or a dependent child losing dependent status. The Institute is responsible for making COBRA continuation coverage available, determining eligibility and complying with all other requirements of the law. Training And Employee Development Performance Reviews Periodically, you will receive input concerning your work performance from your supervisor or department director. These reviews are constructive in nature and are intended to provide a forum for two-way communications between you and your supervisor concerning your performance on the job. It is anticipated that these reviews will take place at least once a year, but more frequent reviews may take place as needed. The Performance Planning and Appraisal Review or PPAR will provide an opportunity for you to provide an evaluation of your own performance and a vehicle to discuss your supervisor's observations. The focus will be on your performance, a discussion of strengths and weaknesses, development plans, and the establishment of goals for the coming period. In addition, a discussion of your career plans and training needs will be a part of your performance review. The results of your performance review will be documented, and you will be given a copy of the review for your records. 21

  23. Miscellaneous Information Safety Every employee is responsible for safety and must be safety conscious. Please report any unsafe or hazardous condition directly to your supervisor immediately. Every effort will be made to remedy problems as quickly as possible. In case of an accident involving any personal injury, regardless of how serious, please notify the Director of Human Resources immediately. Failure to report accidents promptly can result in a violation of our legal requirements and can lead to difficulties in processing medical and insurance claims. The Institute carries workers' compensation insurance for injuries sustained while on the job and will assist employees to obtain all benefits to which they are entitled. Telephone Policy Our telephone lines are intended solely for business purposes. Therefore, employees are requested to keep all personal phone calls to a minimum. Friends and relatives should be discouraged from calling during working hours unless absolutely necessary. Under no circumstances should you make or charge a long distance call to the Institute unless it is work-related nor should you offer the Institutes 800 number to anyone other than a student, parent or individual providing services or employment for students. Electronic Mail and Phone Mail E-mail and voicemail are to be used for business purposes. Correspondence through these devices are considered property of The Art Institute Online. Under no circumstances should messages of a lewd, harassing or inappropriate nature be posted to or left on e-mail or phonemail. It is the responsibility of every employee to check their mailboxes on a timely basis. Solicitation And Distribution In order to eliminate the possibility of disruption of operations and annoyance of employees, the following rules regarding solicitations and distribution of literature on school property will apply. Solicitation by an employee of his or her fellow employee, during working time of either employee, on behalf of any individual, organization, club or cause is not permitted. Distribution of any literature to an employee by another employee during working time, or at any time in any working area, is also not allowed. Any solicitation or distribution by any persons who are not employees of the Institute is also prohibited. 22

  24. Bulletin Boards Information of special interest to all employees is posted regularly on bulletin boards in the employee and faculty lounges. There you will find notices of state and federal laws, as well as general communications, and other information regarding any changes in policies. Position openings will also be posted on the bulletin boards. All requests to place information on the boards should be made directly to the V/P Director of Operations. Mailroom The activities of the mailroom are for AiO/EDMC business only. It is not acceptable to have your personal mail delivered to the school. The Art Institute Online is not responsible for the loss of personal itemsor the inadvertant opening of personal mail that is delivered here. Smoking The Art Institute Online is committed to providing a safe and healthful work place. Accordingly, smoking is not permitted in individual offices or common areas. Smoking is permitted only on the terrace. Termination The Art Institute Online is committed to a standard of excellence in the services it provides to its student clients. Our employees have participated in our efforts to meet this commitment and to achieve a standard of excellence. Because the Institute and its employees are judged on their performance and results, it is important that both retain the ability to determine their own relationship with one another. Consequently, it is also important to note that employees and the Institute share the right to sever the employment relationship at will, at any time, with or without cause or advance notice. There are no express or implied promises that in any way conflict with this right. 23

  25. Employee Acknowledgement (Please Sign and Return to the Human Resources Department) This is to acknowledge that I have received a copy of The Art Institute Online Employee Handbook . Legal words and phrases have been avoided as much a possible in this handbook. The contents are presented as a matter of information and are not to be construed as a contract. However, I understand that it contains important information regarding personnel policies and my obligations and privileges as an employee, and I will familiarize myself with the material in the handbook. The Art Institute Online may change, rescind, or add to any policies, benefits, or practices described in the handbook from time to time at its sole discretion with or without notice. Any material changes will be communicated to employees within a reasonable time. _________________________________________________________ Employee Signature Date _________________________________________________________ Employee Name (Type Or Print)