Paying Back Training Benefits

[FlyingLarry]

What is the name of your state (only U.S. law)? Kentucky

My employer just released a policy whereby each employee is required to sign and submit a form for each employer paid training expense. By signing the form, the employee is agreeing that if they should no longer be employed by the same company for longer then a year from the date of training, the employee will have to pay the company back all said training expenses.

I have been employed by other companies with much larger training expenditures and much larger employee turnover who did not have such a policy. Neither have I ever heard of such a policy before. It makes me wonder if it is even legal. I would have to think the employer would no longer be able to claim any tax incentives for training expenses.

Is this policy legal? What are the legal ramifications?

Thank you so much for your responses,
LarryWhat is the name of your state (only U.S. law)?

 

[LdiJ]

What is the name of your state (only U.S. law)? Kentucky

My employer just released a policy whereby each employee is required to sign and submit a form for each employer paid training expense. By signing the form, the employee is agreeing that if they should no longer be employed by the same company for longer then a year from the date of training, the employee will have to pay the company back all said training expenses.

I have been employed by other companies with much larger training expenditures and much larger employee turnover who did not have such a policy. Neither have I ever heard of such a policy before. It makes me wonder if it is even legal. I would have to think the employer would no longer be able to claim any tax incentives for training expenses.

Is this policy legal? What are the legal ramifications?

Thank you so much for your responses,
LarryWhat is the name of your state (only U.S. law)?

You are correct that there would be tax issues arising from this policy.

However, an employee is free to refuse to sign the form, but since most employment is "at will" the employer would also be free to terminate the employee if they refused to sign.

 

[OHRoadwarrior]

This is a standard practice in some industries with high turnover. It makes employees fear losing their job, by subjecting them to a repayment penalty and makes them docile yes men. In the trucking industry, they call those people "meat in the seat".

 

[FlyingLarry]

Understood. Thank you for the reply.

I guess for some reason I thought these things were not as simple as agreeing to a contract. I thought there were instances where even an agreed upon contract was insubstantial based on existing laws. Your response implies there is no such exception in this case.

I was hoping I could reduce my risk of termination by signing the form with confidence that such a contract could never be legally enforced.

Perhaps I was hoping too much.

Thanks,
Larry

 

[eerelations]

You were hoping too much. This contract is legal.

 

[LeeHarveyBlotto]

This is a standard practice in some industries with high turnover. It makes employees fear losing their job, by subjecting them to a repayment penalty and makes them docile yes men. In the trucking industry, they call those people "meat in the seat".

On the other hand, in other industries, it makes perfect business sense for the company to protect its investment, which is spent for the purpose of making the employee more valuable to them, not more valuable to the job marketplace (someone learning a new programming language, for example).

In any event, it's perfectly legal.