Can employers recover training fees from their ex-employees?

An employer cannot prevent an employee from leaving their job to go and work somewhere else, however employers can attempt to recover the costs of the employee’s training. The costs of training the employee may be treated as a loan from the employer to the employee. This loan may be repayable if the employee leaves within a certain time period after the completion of their training.

Then, if the employee leaves their employment shortly after they have completed their training, the employer will not receive the anticipated benefits but they also will not suffer a financial detriment. This arrangement usually is contained in an agreement that is separate to the contract of employment.

This allows the employer to recover the costs of training even if they are responsible for involuntarily or voluntarily breaching the contract of employment.
The agreement should contain a sliding scale of repayment that reduces the amount of the loan with the amount of time that the employee remains in employment.
This allows the employee’s debt to be reduced as they benefit the employer with their training. In addition, any additional benefits received by the employer from the training, such as being able to charge clients a higher fee, will be taken into consideration if and when the loan is to be repaid. The agreement must ensure that the costs to be repaid are a genuine pre-estimate, otherwise the costs will be considered a penalty for resigning and the agreement will be unenforceable. Both parties may wish to get legal advice on the agreement before signing it to ensure that it is reasonable and will be enforceable.
Employers will be wary of trying to extract the repayment of the training costs from an ex-employee, as they may have to resort to court action.

To avoid this, the agreement may state that the employer is entitled to deduct the repayment from the employee’s salary, or other payments on the termination of the contract. In order for these deductions to be lawful, the employee must specify their agreement in writing. It is possible that, if not correctly, this could constitute an unlawful deduction from wages, and an employee should get legal advice from an employment solicitor.

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