Repaying Training Costs

wildheart83

I've been with my company for a little over a year. I was roped into doing some training courses at work that are subject to clawback agreements. 

I've now decided to leave and I'm aware that I'll need to repay the training costs as per agreements, but I'm unsure whether they can be repaid pre deductions, by way of salary sacrifice, or whether they'll be post deductions.

If it's post tax, is there any way to negotiate a plan to repay over a couple of months, or does it have to be repaid in full before I leave or on leaving? I raised it with my manager who said not to worry about it, but this is a company who reclaim salaries for sick days if you're sick within 6 months so they seem pretty ruthless.

It's around £2.5k so a fair chunk of money if I don't get paid from the new company for about 6 weeks and they take the lot in one payment after tax.

Undervalued

wildheart83 said:

I've been with my company for a little over a year. I was roped into doing some training courses at work that are subject to clawback agreements. 

I've now decided to leave and I'm aware that I'll need to repay the training costs as per agreements, but I'm unsure whether they can be repaid pre deductions, by way of salary sacrifice, or whether they'll be post deductions.

If it's post tax, is there any way to negotiate a plan to repay over a couple of months, or does it have to be repaid in full before I leave or on leaving? I raised it with my manager who said not to worry about it, but this is a company who reclaim salaries for sick days if you're sick within 6 months so they seem pretty ruthless.

It's around £2.5k so a fair chunk of money if I don't get paid from the new company for about 6 weeks and they take the lot in one payment after tax.

Anything may be negotiable, but there is no legal right to "easy terms". Providing he money is owed they can lawfully deduct it from your final salary, right down to zero, and send you a bill for any extra.

Can't answer the salary sacrifice question. However even if it is lawful I don't think there is any obligation on the employer to oblige.

Regardless of the contract, any reclaim of training costs must be reasonable and proportionate, they cannot amount to a penalty. However, even if you had a case in this respect you cannot stop them taking the money so you would have to sue to get any excess back.

LinLui

I don't think that it is particularly hrash to reclaim sick pay to which someone isn't entitled - although if they aren't entitled to it then not paying it in the first place would be more efficient.

£2.5k is an awful lot of training to be "roped into". Whilst it is hard to prevent an employer from taking money which they are due, whether the training was of sole benefit to the employer - i.e. needed to do the job and for no other reason - can influence how enforceable such terms are. What was this training?

Training can, in some circumstances, be paid for via salary sacrifice, but it needs to be set up in advance and can't be retrospective, and the employer would need to confirm their arrangements with HMRC. They have no incentive to get involved in trying to deral with the bureaucracy involved in doing that.

Brie

Check the clawback agreement to see if you have to repay the whole amount or not.  My previous employer had a 3 year rule where, if they paid for training, you would have to pay back the full amount if you left immediately.  After a year the payback was reduced by 1/3, after 2 years, 2/3 and after 3 nothing was payable.  It's based on the assumption that they only pay for training that might be relevant to your job and they get some benefit from you having been trained.

wildheart83

Brie said:

Check the clawback agreement to see if you have to repay the whole amount or not.  My previous employer had a 3 year rule where, if they paid for training, you would have to pay back the full amount if you left immediately.  After a year the payback was reduced by 1/3, after 2 years, 2/3 and after 3 nothing was payable.  It's based on the assumption that they only pay for training that might be relevant to your job and they get some benefit from you having been trained.

It's a similar rule, over 2 years. But it's been less than a year so I'd imagine they want the full amount. At the time I was prepared to stay for the 2 years but the situation changed so I'm leaving sooner rather than later.

The training was to allow me to work in a different sector; it's a consultancy so the more sectors I can work in the easier I am to place. 

DullGreyGuy

The time to negotiate these things is before you do the training when you still have leverage. If you dont ask you dont get but if they simply say no there is not much that can be done and you are bound by the terms of the agreement you made. 

Savvy_Sue

Is the training you've done of benefit to your new employer? I have known a new employer pay a new employee for training that has had to be repaid, because they are reaping the benefit of not having to pay for the training! 

wildheart83

DullGreyGuy said:

The time to negotiate these things is before you do the training when you still have leverage. If you dont ask you dont get but if they simply say no there is not much that can be done and you are bound by the terms of the agreement you made. 

Unfortunately it's a bit late for that. The situation changed after I'd done the training.