As the court cases above show, recovery is an uphill battle. But as they also show, these agreements are sometimes enforceable. Employers need to consider whether legal fees and the potential impact on employee morale are worth restoring. Details. The agreement should specify the cost of the training, the duration of the training, the duration of the training, the length of time the employee will be required to remain in the position after the training period and the reimbursement requirement. A pro-rated reimbursement scale based on length of employment after training is common. But especially for employers, it can also be used to determine when an employee might be responsible for reimbursing these training costs and how that reimbursement would work. In particular, it can define whether these costs become reimbursable if an employee leaves the company shortly after completing the training. In Jeremy Sanders, the plaintiff, v.
Future Com, LTD., ruled earlier this year that an employer had successfully implemented an agreement in a letter of offer that the employee is required to reimburse him for training costs if he or she leaves the company within one year of completing the training. The employee argued that the reimbursement provision in the letter of offer was not part of his employment contract, but the court found that this was the case, at least in Texas. It awarded the employer $38,480.35 in damages and $34,000 in legal fees. If a training agreement has the practical effect of «catching» an employee in their current role, it may be unenforceable. The Caldecott Foundation invests significant resources in training to achieve: – Employers must ultimately decide for themselves – but with the help of experienced consultants – whether or not to accept the requirements for reimbursement of the training. This «type of training» factor can be of particular importance, says Sam Caucci, CEO and founder of 1Huddle, an employee training platform. In particular, if an employee obtains certifications that may be useful elsewhere, it may be a good idea to complete a refund. But agreements must be properly formulated to survive in court. «You can`t see this punishing the employee just to compensate the employer,» he noted. Some training agreements operate on a kind of sliding scale where the longer the employee stays in the company, the less he has to repay if he decides to continue. In other companies, the training agreement is a bit black and white, with a certain threshold that dictates when the employee is no longer responsible for reimbursements. But at the end of the day, it really depends on the level of the employee, the actual spending on training, the nature of the training program and a judgment on whether attempts to recoup those costs will affect employee morale, he said.
The second thing to consider when using training agreements is the idea of «restricting trade». As mentioned earlier, training contracts are designed to protect companies from losing their investments – but the law does not allow an employer to use them to inappropriately prevent someone from changing jobs. If you`re running a small business, it`s important to help your team grow and develop, but you also need to make sure that every investment you make in your team is protected. This is where a training agreement can help. In this article, we will show you exactly how to use a training contract and provide you with a free training contract template written by professionals. Voluntarily. First of all, the training for which you are requesting a refund may have to be voluntary. While workers are required to undergo training as a condition of employment, the courts have largely ruled that the costs are non-refundable. Similarly, the addition of a non-compete obligation can harm an employer, as an employee would not be able to use the training anywhere else. This is where a training reimbursement agreement comes into play – it`s a way for companies to ensure they don`t suffer any financial loss when paying for the development of their employees.
The answer is complex and the case law is different. In USS POSCO Industries v. Floyd, an employer was awarded a portion of the training costs – $28,000 – and another $80,000 in legal fees. The case concerned a beginner who participated in a voluntary training program to advance his career. He enrolled in paid training that included 135 weeks of instruction, 90 weeks of on-the-job training and 45 weeks of in-person instruction. The purpose of training agreements is to protect companies from losses when they invest in their team. This is not intended to be a tactic to prevent people from stopping. For this reason, the amount of money that the training contract is intended to recover must be a reasonable estimate of the money the company has lost. When trying to make repayment arrangements, there are a few important things to remember. In reality, many employers won`t really try to cover the costs of training an employee. Instead, the agreement acts as a selection tool, Caucci noted. The hope is that only serious and committed candidates will agree.
Let`s take a look at an example of a training agreement in action. If a company were to spend £1,000 on a training course but the employee resigns the day after the course ends, it would be fair and appropriate to ask the employee to repay the £1,000 as part of a training agreement. .