7 August 2018
Category: news
7 August 2018,
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Who Do You Want to Train With?

Training opportunities are great – but watch draconian repayment clauses and long tie-in periods.

No matter at what stage in your career, the training offered by your employer matters. It can keep you up to date on new developments and techniques, or it can set you up on a new career path: both employers and employees benefit.

Many employers provide training for free and do not expect any tie-in period or payback from their employees. That said, in principle most people would accept some form of repayment or tie-in arrangement as reasonable. After all, it helps deter an employee leaving immediately after the training and using the newly acquired skills for the benefit of another employer (together with, often, a pay rise).

However, some companies take the pay-back mechanism to extremes.

Capita and FDM Group require their trainees to work for them for two or more years, or else be liable for fees of £20,000 or more. What’s more, Capita require job hunters to carry out three or four months unpaid training before being considered for salaried work.

This practice has been described by some as “Victorian-style indentured labour practices”, and resistance to it has been gathering apace. In Capita’s case, you can imagine the bad PR given its reliance on public sector contracts.

Sure enough, in response to the campaign Capita recently announced that it would no longer be seeking to enforce any existing training fee repayment clauses. FDM has yet to respond. It is not inconceivable that a legal challenge could be mounted for recovery of the repaid fees or even under the Modern Slavery Act.

Is this the tip of the iceberg, with companies across the country operating this kind of extreme repayment clause? I suspect not, but it does highlight the need to think carefully about repayment mechanisms.

There is a balance between creating loyalty from employees by encouraging training and development, versus generating resentment and fear of leaving. Certainly, it is worth thinking about tapered repayments which reduce over time, or not enforcing all the training costs if they are high relative to the individual’s salary.

One disturbing thought, however, is that for many years (ie decades) the UK has had a poor record in training and investment in its people compared with other countries. The naming and shaming of the likes of Capita and FDM may not change things overnight, but if it changes some attitudes towards the value of training that can only be positive.

(c) Ben Thornber, Thornber HR Law

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