Upskilling: When an Employee Quits, Can You Recoup Their Training Costs?
The job market has seen enormous change over the last decade. Technology is evolving at pace, and many job seekers simply don’t have the skills and experience required for the available jobs—especially those that require new and advanced skills.
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In some instances, the skills that were highly sought after ten years ago are no longer relevant today, and certain job functions are now obsolete. When you add in the pandemic-fueled mass exodus of workers from the workforce, you are left with a highly-competitive job market and an ever-increasing skills gap.
As a result, many companies have turned to upskilling and reskilling their existing workforce, in a bid to build a highly skilled team to support the business through post-pandemic recovery and into the future, sometimes at great expense.
But what happens if the employee quits before the company benefits from its training investment? Can you ask the employee to reimburse you? Is it legal to even ask?
The answer is yes, you can ask, with the following caveats:
The training must be portable and voluntary. This means the training will continue to be valuable to them if they leave your organization.
You must create a repayment agreement and provide it to the employee to sign before the training program begins.
The agreement must specify the training cost, and the length of time the employee must stay after the training for the repayment to apply. If you wish you can include a prorated sliding scale where the amount to be reimbursed decreases the longer the employee stays.
You understand this is a legal agreement and local, state, and federal laws will apply as well as collective bargaining agreements. These could prohibit you from recouping your training costs. This means you need to have a lawyer review to ensure your agreement has a chance of succeeding in getting you repaid.
You also need to keep in mind the costs and effort needed to get those who leave to actually reimburse you, and whether this will impact morale within your organization should your current employees learn of you pursuing a former employee in court.