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Can my employer claw back training costs if I leave my training contract early? watch

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    Hi,

    If anyone with some prior experience of this or some legal knowledge could give this a quick read and advise. I would be eternally greatful.

    My training contract states under the "Cancellation and Re-registration of student training contract" section:

    23. Both parties intend this contract will cease after the completion of 36 months from the start of the contract. It is recognised that during this period, the firm will provide both exam training with professional tutors and periods of paid study and exam leave as referred to in paragraph 12 and 13.

    24. It is understood and agreed that if you wish to cancel your ICAEW training contract with us and re-register it with another firm of accountants within the contract period, you will repay to the firm all the costs incurred in providing you with your study material and exam training, exam fees and all paid study leave incurred by the firm during the period of the contract up to a maximum of £6,000.

    25. You authorise the firm to deduct the amount due under the above clause from any amounts due to you on your date of cessation of employment including your salary for your final period of work, any accrued holiday pay and other amounts due to you in respect of your employment. If the above amount is insufficient to cover the full amount of the costs incurred by the firm, then any further balance will become due and payable on your last day of employment with the firm. If such balance remains unpaid within a period of 30 days from your giving notice to terminate your contract of employment, then the firm may not be able to provide certificates of suitability required by the ICAEW to register a cancellation of your training contract.
    ...............................

    No where else in my contract is anything mentioned about this. I handed in my notice today and I do not plan to re-register with another firm. However, my boss said I will have to repay training costs back after he's costed them up. I am planning to rely on the fact that as per 24. I am not re-registering with another firm and therefore won't owe anything to my firm. As because I am not re-registering paragraph 24. is null and void and ergo so is paragraph 25.

    Any advice would be greatly appreciated.

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    (Original post by Rustean)
    Hi,

    If anyone with some prior experience of this or some legal knowledge could give this a quick read and advise. I would be eternally greatful.

    My training contract states under the "Cancellation and Re-registration of student training contract" section:

    23. Both parties intend this contract will cease after the completion of 36 months from the start of the contract. It is recognised that during this period, the firm will provide both exam training with professional tutors and periods of paid study and exam leave as referred to in paragraph 12 and 13.

    24. It is understood and agreed that if you wish to cancel your ICAEW training contract with us and re-register it with another firm of accountants within the contract period, you will repay to the firm all the costs incurred in providing you with your study material and exam training, exam fees and all paid study leave incurred by the firm during the period of the contract up to a maximum of £6,000.

    25. You authorise the firm to deduct the amount due under the above clause from any amounts due to you on your date of cessation of employment including your salary for your final period of work, any accrued holiday pay and other amounts due to you in respect of your employment. If the above amount is insufficient to cover the full amount of the costs incurred by the firm, then any further balance will become due and payable on your last day of employment with the firm. If such balance remains unpaid within a period of 30 days from your giving notice to terminate your contract of employment, then the firm may not be able to provide certificates of suitability required by the ICAEW to register a cancellation of your training contract.
    ...............................

    No where else in my contract is anything mentioned about this. I handed in my notice today and I do not plan to re-register with another firm. However, my boss said I will have to repay training costs back after he's costed them up. I am planning to rely on the fact that as per 24. I am not re-registering with another firm and therefore won't owe anything to my firm. As because I am not re-registering paragraph 24. is null and void and ergo so is paragraph 25.

    Any advice would be greatly appreciated.

    It might just be a badly worded contract and therefore you probably need proper legal advice on this rather than on a forum.

    But it was/is pretty standard for firms to recoup the costs no matter the reasons for someone resigning, whether they were going to another firm or not.


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    (Original post by J-SP)
    It might just be a badly worded contract and therefore you probably need proper legal advice on this rather than on a forum.

    But it was/is pretty standard for firms to recoup the costs no matter the reasons for someone resigning, whether they were going to another firm or not.


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    Thanks. I have asked two people with a masters in law and they think I will be ok to challenge on the basis of the contract but I just wanted further discussion and advice.
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    (Original post by Rustean)
    Hi,

    If anyone with some prior experience of this or some legal knowledge could give this a quick read and advise. I would be eternally greatful.

    My training contract states under the "Cancellation and Re-registration of student training contract" section:

    23. Both parties intend this contract will cease after the completion of 36 months from the start of the contract. It is recognised that during this period, the firm will provide both exam training with professional tutors and periods of paid study and exam leave as referred to in paragraph 12 and 13.

    24. It is understood and agreed that if you wish to cancel your ICAEW training contract with us and re-register it with another firm of accountants within the contract period, you will repay to the firm all the costs incurred in providing you with your study material and exam training, exam fees and all paid study leave incurred by the firm during the period of the contract up to a maximum of £6,000.

    25. You authorise the firm to deduct the amount due under the above clause from any amounts due to you on your date of cessation of employment including your salary for your final period of work, any accrued holiday pay and other amounts due to you in respect of your employment. If the above amount is insufficient to cover the full amount of the costs incurred by the firm, then any further balance will become due and payable on your last day of employment with the firm. If such balance remains unpaid within a period of 30 days from your giving notice to terminate your contract of employment, then the firm may not be able to provide certificates of suitability required by the ICAEW to register a cancellation of your training contract.
    ...............................

    No where else in my contract is anything mentioned about this. I handed in my notice today and I do not plan to re-register with another firm. However, my boss said I will have to repay training costs back after he's costed them up. I am planning to rely on the fact that as per 24. I am not re-registering with another firm and therefore won't owe anything to my firm. As because I am not re-registering paragraph 24. is null and void and ergo so is paragraph 25.

    Any advice would be greatly appreciated.

    Yup they worded it badly. But I bet they try to claim it back anyway...

    Also how do they know you won't register with another accountacy firm in the future?

    IANAL.
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    (Original post by Rustean)
    Thanks. I have asked two people with a masters in law and they think I will be ok to challenge on the basis of the contract but I just wanted further discussion and advice.
    I'd get advice from a lawyer working in practice rather than anyone in academic law. They will also need to see the full contract.Obviously you could challenge the firm first yourself (you don't have anything to lose by doing so).
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    (Original post by J-SP)
    I'd get advice from a lawyer working in practice rather than anyone in academic law. They will also need to see the full contract.Obviously you could challenge the firm first yourself (you don't have anything to lose by doing so).
    Thanks. I will challenge them but I wanted to know how to approach it since I might want a reference from them know day.
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    (Original post by Rustean)
    Thanks. I will challenge them but I wanted to know how to approach it since I might want a reference from them know day.
    They are only going to provide you with a standard reference anyway - dates you worked, position/job title, and possibly salary. Very few organisations will provide more than that these days.


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    (Original post by J-SP)
    They are only going to provide you with a standard reference anyway - dates you worked, position/job title, and possibly salary. Very few organisations will provide more than that these days.


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    ^this

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    If you cnat afford a lawyer then go to a law centre or at least find someone willing to interview you and look at the documents. Its always unsatisfactory on forums becayse people miss things out, which changes the advice given.

    My take on the limited info provided is that they only recoup the money if you are going to re-register within the period.
    Their hold on it besides you signing the contract agreeing to the liability will be their refusal to provide a certificate of suitability, which presumably prevents you from registering with another firm?

    Just because something is written in a contract doesnt mean they would seek to enforce it. It depends on the employer and they will if they want to, they might need the money, be offendd or have taken a dislike to you. Big firms tend to be less bothered about the money, but small firms can be more petty imo. Its unclear whether theres anything personal going on. They may try and deduct the money from your salary, but take it no further. You would have to decie whether you wnat to pre-empt this and check.

    Agree you are more likely to get a standard reference which just includes dates and position, but they cna add stuff as long as its true.

    Id agree with you that they have made the section include cancelation and re-registration rather than cancelation alone. If you arent re-registering, then it wont apply. Go and get a fixed fee interbiew with a solicitor or see if you have access to a legal helpline or make an appointment at a law centre..

    Perhaps you cna get help from the ICAEW?
    http://www.icaew.com/en/membership/s...ethics-support

    If thats not the right place, then they cna direct you. there must be some young trainee group?
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    (Original post by jneill)
    Yup they worded it badly. But I bet they try to claim it back anyway...

    Also how do they know you won't register with another accountacy firm in the future?

    IANAL.
    They cnat claim it back if they arent entitled to.
    Likely that this refusal to probide a certificate of satisfaction will prevent a double registration.
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    (Original post by 999tigger)
    They cnat claim it back if they arent entitled to.
    Likely that this refusal to probide a certificate of satisfaction will prevent a double registration.
    I know they shouldn't according to the wording we have seen. But they may try to do so...

    I agree it's best to get proper advice on this. And the professional association is also a good place to ask.



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    (Original post by jneill)
    I know they shouldn't according to the wording we have seen. But they may try to do so...

    I agree it's best to get proper advice on this. And the professional association is also a good place to ask.



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    I think it might just be me, but even at 13 I would have told them no. If she can talk to the ICAEW all well and good, but they will have limited funds to consult anyone else. It may be worth heading off at the pass and identify what their intentions are before they start deducting money. Lots of these things just go down to personalities. Its quite rare for law firms to try and recalim their money, even if they go to a competitor, but they always have that option if you annoy them.

    The manager might not have a clue what they are on about, could be any of a number of interpretations.
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    (Original post by 999tigger)
    I think it might just be me, but even at 13 I would have told them no. If she can talk to the ICAEW all well and good, but they will have limited funds to consult anyone else. It may be worth heading off at the pass and identify what their intentions are before they start deducting money. Lots of these things just go down to personalities. Its quite rare for law firms to try and recalim their money, even if they go to a competitor, but they always have that option if you annoy them.

    The manager might not have a clue what they are on about, could be any of a number of interpretations.
    Law firms are very different though. Very few trainee lawyers will move firms mainly where it's very difficult to do so. There isn't a culture of switching firms mid training contract. In fact the only time I have known it to happen is when a firm has gone bust and then the law society and SRA tend to support the process anyway.

    It's much more common in accountancy firms, especially where accountancy exams are taken while you are working. All it takes if for someone to fail their exams and a firm may look to take on another trainee/someone coming up to accreditation. It's why many accountancy firms have this type of term in their contract (that and too many leave the profession because they realise they hate it).

    Any organisation is likely to stick quite rigidly to the terms for fear of word getting around that they are a soft touch on these things. It only tends to be in extreme personal circumstances (illness/family bereavements) that they let is pass. If it wasn't an issue for an organisation they wouldn't even bother having a claw back in the contract.


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    just stick out your TC and then move on
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    (Original post by J-SP)
    Law firms are very different though. Very few trainee lawyers will move firms mainly where it's very difficult to do so. There isn't a culture of switching firms mid training contract. In fact the only time I have known it to happen is when a firm has gone bust and then the law society and SRA tend to support the process anyway.

    It's much more common in accountancy firms, especially where accountancy exams are taken while you are working. All it takes if for someone to fail their exams and a firm may look to take on another trainee/someone coming up to accreditation. It's why many accountancy firms have this type of term in their contract (that and too many leave the profession because they realise they hate it).

    Any organisation is likely to stick quite rigidly to the terms for fear of word getting around that they are a soft touch on these things. It only tends to be in extreme personal circumstances (illness/family bereavements) that they let is pass. If it wasn't an issue for an organisation they wouldn't even bother having a claw back in the contract.


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    Ive come across quite a few situations on qualifcation rather than mid TC where the reclaim of fees is still relevant. Although I was using it as an exmaple i wasnt suggesting their behaviours was exactly the same.

    So you are saying these clauses are typical and are more likley than not enforced rather thna being present just to give them the option? Notwithstanding the wording of the OP's contract.
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    (Original post by 999tigger)
    Ive come across quite a few situations on qualifcation rather than mid TC where the reclaim of fees is still relevant. Although I was using it as an exmaple i wasnt suggesting their behaviours was exactly the same.

    So you are saying these clauses are typical and are more likley than not enforced rather thna being present just to give them the option? Notwithstanding the wording of the OP's contract.
    Yes - I meant that they are more likely to be enforced than not. It's only in exceptional circumstances that they are unlikely to. To have it in place and then use it sporadically leaves it more difficult to enforce it - especially if word of mouth suggests that they haven't done it with some people with similar situations in the past.

    The fact the manager has already started the reclaim process without really asking any questions suggests that it's a standard process no matter what the reasons for resigning part way through a training programme.

    Law firms have another quirk that if they try and reclaim the costs, they have an additional tax bill to pay - not just for that individual but for any one else they have sponsored in the same year. It tends to be firms with very small intakes that claw back and even then there have been some legal challenges as to whether they can. Why many law firms might have this term but don't enforce it!


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    (Original post by J-SP)
    Yes - I meant that they are more likely to be enforced than not. It's only in exceptional circumstances that they are unlikely to.
    What about the clause 24 wording:
    "24. It is understood and agreed that if you wish to cancel your ICAEW training contract with us and re-register it with another firm of accountants within the contract period, you will repay to the firm all the costs incurred in providing you with your study material and exam training, exam fees and all paid study leave incurred by the firm during the period of the contract up to a maximum of £6,000."

    The way it is worded means that repayment only happens if they cancel their TC AND re-register with another firm. The OP is cancelling but not re-registering elsewhere, therefore no repayment is due...?
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    (Original post by jneill)
    What about the clause 24 wording:
    "24. It is understood and agreed that if you wish to cancel your ICAEW training contract with us and re-register it with another firm of accountants within the contract period, you will repay to the firm all the costs incurred in providing you with your study material and exam training, exam fees and all paid study leave incurred by the firm during the period of the contract up to a maximum of £6,000."

    The way it is worded means that repayment only happens if they cancel their TC AND re-register with another firm. The OP is cancelling but not re-registering elsewhere, therefore no repayment is due...?
    That's how I read it too. I suspect in this instance it is just badly worded though (as I said earlier) and not what they really mean/want. I could be wrong, but that's what my instinct is telling me.


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    Funny how both of you mention its being badly worded, whereas I just see it as non applicable. I get what you mean as it doesnt cover this particular circumstance, but I have little sympathy for them and would insist on saying no if they sought to try and reclaim under it.

    Which then brings us back to who will advise.

    Its a max of £6k.

    Not sure the OP has any money or how much the min cost of a lawyer being prepared to give legal advice would be.
    I dont think CAB puts them any further forward.
    If they are going to enforce, then they are going to deduct it from the salary i.e not pay anything for starters, which will leave the OP in the situation of having to fight and reclaim the deduction. That's why she needs to head it off at the pass if its a big deal.
    Backing from the ICAEW might help, but then again you have the issue that they might not wish to say this directly and tell her to consult a lawyer. Such fun.

    ps I assuemd the OP was a she for soem reason.
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    Thanks for all the replies. I fee a lot more ready to take on my firm and what to suspect they'll throw at me.
 
 
 
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