HR Update - Training agreements

Most employers provide some training, which can be costly. If you have concerns about an employee leaving either during the training or on completion, then having a training agreement could help ensure that you are protected and enable you to claim back money for the cost of the training if they leave. You cannot rely on a deductions clause in the employment contract.

Key points

If you are going to use a training agreement then I recommend the following:

To be able to recover training costs from an employee who leaves during or shortly after training you need to have a written training agreement before training starts.

The training agreement should be a separate document from the employment contract.

This agreement should be in writing and given to the employee alongside a clear explanation of what it means. Make sure you have the employee's consent to this agreement by ensuring they sign it.

Explain why the repayment is necessary.

Set up a sliding scale repayment. This means the employee will repay all, or a proportion of, the money you have invested should they leave after completing training. The most effective way to do this is to decide on a staggered system of clawback whereby the amount to be repaid by the employee decreases with time until a certain period has lapsed, after which no repayment is due.

You can calculate your own schedule of repayment. Most agreements stipulate a repayment of 100 per cent of the training costs if the employee resigns within three months of training; 75 per cent within three to six months; 50 per cent within six to nine months; and 25 per cent within nine to 12 months. After 12 months, no repayment would be due.

Ensure the figure to be repaid is an actual reflection of fees paid and not just an arbitrary sum, or it may be unenforceable.

Ensure there is a clause in the agreement to allow you to make deductions from the employee's final salary in respect of training fees if he or she leaves.