Can HR recover the cost of employee education?

It’s fairly common to see organisations funding the further education of their staff – whether it’s a pricey training session or a post-graduate degree – but what can HR do if that employee jumps ship shortly after?

“If you’re just training someone to do the job for you then that’s the employer benefitting primarily even though the employee might pick up some skills along the way,” says Hamish Kynaston, employment lawyer and partner at Buddle Findlay.

“If the employer was to recoup that cost or to bond the employee for that cost, then it runs the risk of being considered a premium and therefore unlawful,” he explains.

However, if the employee is clearly benefitting from the further education, Kynaston says employers are entitled to – and often do – bond staff.

“If the employer is supporting the employee to do their masters, their MBA or something similar – where employee clearly receives a benefit external to the employer – then that’s a different story,” he says.

“It would be quite common in those circumstances for the employer to bond the employee in that case if he or she were to leave shortly afterward or within the agreed period.”

The agreed period, he explains, is down to the parties involved to decide and often varies between organisations and individual situations.

“It depends on the particular amount that’s been paid and then the benefits that go both ways,” he says. “If it’s a masters or something like that, it might just be a year but it would depend on the level of investment, how much it’s cost the employer and what the employer and employee agree.”

While technically employers are entitled to enforce longer time periods, Kynaston warns excessive limits are often considered unfair and impractical.

“Even if legally you agree a period of five years, realistically that becomes really difficult to enforce in a practical way because people have a right to come and go,” he explains.

“Five years would be a really long time but if that’s the deal and the employee left and four and a half years, it would be for the employer to decide if they want to recoup the costs. It doesn’t come across as that reasonable but if that’s the deal, that’s the deal.”