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Training cost repayment agreement letter

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If you are sponsoring training, use this model letter to inform an employee that repayment of the cost is required if they resign before or shortly after it is complete.

You have the option to 'split' the cost, or commit to pay the full amount. Depending on which, update the appropriate wording.

Reading time
How long to understand and implement this letter?
10 mins
Word count
How many words in this letter?
466
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What is a Training cost repayment agreement letter?

A Training Cost Repayment Agreement Letter outlines terms for employees to repay training costs if they leave within a specified time.

It includes the amount, payment terms, consequences of non-payment, and legal rights.

This letter ensures clear understanding and compliance with the agreement.

Best practice timescale for this to be issued
When should this letter be issued?
As and when required
Issued by who, to whom
Who should issue this letter, and to whom?
The Employer (you) to the Employee
Applicable legal jurisdictions
In which jurisdictions can this letter be used?
Great Britain & NI (United Kingdom), Worldwide

How can I ensure that this letteris executed effectively?

Step Description Responsible Party Timing (Days from Decision)
1 Training Cost Assessment: Identify the training costs incurred by the employer for the employee's development. HR / Training Team N/A
2 Company Policies Review: Review company policies related to training cost repayment and legal requirements. HR / Management Team Day 1
3 Determine Repayment Terms: Determine the specific amount and repayment terms for the training cost agreement. HR / Management Team Day 3
4 Prepare Agreement Letter: Create a comprehensive Training Cost Repayment Agreement Letter, including the amount, terms, and legal aspects. HR / Legal Team Day 5
5 Issue the Agreement Letter: After confirming the agreement details, issue the Training Cost Repayment Agreement Letter to the employee, requesting their consent and signature. HR / Management Team Day 7 (Or as deemed appropriate)

What legislation and best practice guidelines have been taken into account in the development of this template?

United Kingdom

  • The Employment Rights Act 1996: This outlines the statutory rights that employees have with regard to deductions from wages, including the right to receive written notice of any proposed deductions. Employers must ensure that any proposed training cost repayment deductions are in compliance with the provisions of this Act.

  • The Equality Act 2010: This prohibits discrimination on the grounds of age, gender, race, religion, disability, and other protected characteristics in relation to training and development opportunities. Employers must ensure that any training cost repayment policies do not result in discriminatory treatment.

  • The Data Protection Act 2018: This sets out the legal requirements for the collection, use, and storage of personal data, including information about training costs and cost recovery policies. Employers must ensure that they are complying with the provisions of this Act when collecting and storing employee data.

  • The Apprenticeships, Skills, Children and Learning Act 2009: This sets out the legal requirements for apprenticeships and skills development, including the provision of training to employees. Employers must ensure that any training cost repayment policies are in compliance with the provisions of this Act.

Overall, employers must ensure that they are complying with all relevant employment legislation when implementing a Training cost repayment agreement letter, and that any training cost repayment policies are fair, reasonable, and do not result in discriminatory treatment.


Other territories

Consult your jurisdiction's employment legislation or labor laws to ensure compliance with the template. Review the language for local precision.

Training cost repayment agreement [Delete this line]

[Company name]

[Sender address]

 

[date]

[Recipient name]

[Recipient address]

 

Dear [Recipient first name],

Further to your request to pursue training on the [name of course], I am pleased to inform you that [Company] will contribute toward the cost of the training. The minimum contribution from [Company] will be £[amount] per academic year for the duration of the training, and the maximum amount that you will be required to pay is £[amount] per academic year for the duration of the training. The contribution from you will be required to be paid to [Company] by bank transfer no later than [14 | 30] days after the payment of the course to the [College | University]. A review will be held on an annual basis to determine whether the business is able to increase its level of financial support to you for each academic year.

You will appreciate that the cost of the training is substantial and the organisation will need to recoup the cost of the training if you leave employment of your own accord (either by resignation or voluntary redundancy) or during the training during a specified period after the training has ended.

The organisation will require you to enter into an agreement to the effect that you repay the training costs on a sliding scale. This means that, if you resign during the training or within [3 | months] months of the date of completion of your training, you will be required to repay the full cost of the training.

Following this period, the amount that you will be required to repay is reduced by [one twelfth at monthly intervals | insert alternative schedule]. Once you have completed [months] months service from the date of the end of the training, you will not be required to repay any of the costs of the training should you resign.

Should you leave the business due to involuntary redundancy, the business will commit to paying the academic year that your leaving date falls within. It will also consider, but will not be obligated to, covering the cost of the remainder of the overall training.

The organisation reserves the right, in accordance with this agreement, to require you on your resignation to repay the organisation for training costs out of your final salary payment. Depending on the circumstances, the organisation may agree to the repayment being made by another method acceptable to it (for example, by a series of repayments after your employment ends if the amount is too great to be repaid out of your final salary payment).

If you agree to the terms of this agreement and deduction from wages as set out above, please sign and return a copy of this letter to me by [date]. Please note that the organisation will not pay the cost of the training fees until a copy of this letter has been signed and returned.

Yours [faithfully | sincerely],

 

 

[Sender name]

[Sender job title]

[Sender telephone]
[Sender email]

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training cost repayment agreement letter