Recovery of inflated training costs

[Chaulender]

A friend of mine works as a delivery driver. During his employment, the employer paid for driver training to enable him to drive larger vehicles. He signed a contract enabling them to recover costs on a sliding scale over two years following completion of that training. He has now chosen to leave the company six months into that period so accepts he will need to repay 75% of the costs.

On the signed document, and below the signatures, is the phrase "training costs £2000". He's almost certain that was not there when he signed the document but has been added since (but not 100% certain). He understands they intend to recover 75% of that sum.

The contract shows the relevant cost categories to be:

a) the course fees for the full course of study/training
b) any relevant examination fee paid on [his] behalf
c) any grant towards the cost of equipment/books paid to [him] by the employer
d) any allowance or other expenses paid to [him] to enable [him] to attend the course

There have been no costs in categories c or d. The total costs involved in the training and examination amount to £950. They used a driver training company which has detailed all the relevant costs amounting to £950 which was billed to the employer, though obviously will not supply a copy of the actual invoice.

My questions are:

1 Are they legally entitled to recover a sum in excess of the actual costs incurred?

2 If not, how can he challenge that? Can he demand to be shown the supporting invoice?

3 I imagine the issue of whether the "£2000" phrase was added subsequent to signing will be difficult to prove. Is the fact that the phrase is beneath the signatures relevant?

[Tools]

Re: Recovery of inflated training costs

He needs to ask them for an itemised breakdown of costs they are claiming, together with documented proof.

What category licence did he train for C or C+E or both?

[Chaulender]

Re: Recovery of inflated training costs

Thanks for your reply.

It was just a C1 category (he passed his driving test after 1997), enabling him to drive up to 7.5 tonnes.

So is their entitlement to charge limited to the actual costs they incurred (ie: £950), whatever was written on the contract?

And what happens if they refuse to supply the itemised costs (which I imagine they will)? The contract gives them the right to deduct the costs from his final pay.

[Tools]

Re: Recovery of inflated training costs

C1 £950 sounds proportionate to me.

If they are claiming they are owed £2000 then they have to give a breakdown if requested.

This may also help him
ITN / Channel 4 news request: Are you owed money by your former employer?

Ask him to consider it as it would be good leverage for him should a dispute arise

[Chaulender]

Re: Recovery of inflated training costs

Today, he gave the employer a letter requesting copies of the documentation (ie: the relevant invoices) on which they will base the reimbursement of costs. They have (verbally) refused to do this, saying they are under no legal obligation to provide that. So what now? What legislation requires them to provide the costs breakdown?

I have found on a couple of other websites the following statement, which seems relevant to this situation - "A provision which requires an employee to pay back money to their employer if they breach the employment contract may be unenforceable as a penalty clause, unless it reflects a genuine pre-estimate of the employer's losses arising from the breach". The reimbursement contract (on which the phrase "training costs £2000" was written) was created and signed before the training assessment day (on which the number of training sessions needed was determined by the instruction company), so at that stage it was impossible to accurately estimate the costs and (as I said earlier) the actual costs were less than half they number they will be basing the reimbursement on. Does anyone know the piece of legislation which that statement above is based on?

[teaboy2]

Re: Recovery of inflated training costs

They do have a legal obligation its called onus of proof, the employee has a right to know exactly what it is they are claiming from him, and has a right to see copy of invoices. Put it this way, if it went to court, the judge would want to see them before ordering employee to pay.

Tell them, onus of proof is on them to prove what they are claiming is what is actually owed, and until employee sees invoices for cost of course/training etc. they can go jump. Make a point that as they have already verbally refused to provide, stating they had no legal obligation to do so, despite onus of proof being on them, then your highly skeptical of their claim and the amounts they are claiming.

Sorry for rush reply, but am in a rush here.

[Chaulender]

Re: Recovery of inflated training costs

Thank you teaboy2. They've also said that the invoices are not relevant because the they will charge the time percentage of the £2000 which was the figure stated on the contract. But surely because we know the actual costs are less than half that figure, they can't legally claim for reimbursement of a figure greater than they incurred? Surely that would represent a 'penalty' as described in my post above?

In practice, they will deduct what they want from remaining wages and so he'll be powerless to stop that happening. If they deduct more than we think is right, what's the right process to try to recover it? Employment Tribunal?

[Tools]

Re: Recovery of inflated training costs

Or here
ITN / Channel 4 news request: Are you owed money by your former employer?

[Tools]

Re: Recovery of inflated training costs

He should put the request of proof in writing, and ask for a reply in writing. Tell him to instruct them that if they try taking any more than the TRUE amount, he has "taken advice" and will seek the excess through the legal route. oh yes, and he is also in touch with Channel 4 News who are very interested in his story

[Chaulender]

Re: Recovery of inflated training costs

Returning to this issue which has not been resolved, and on which there is some new information, so I shall re-summarise the issue as it stands.

My friend was employed as a delivery driver. During his employment the company paid for him to receive driver training to enable him to drive larger vehicles. He signed an agreement requiring him to reimburse the cost of that training if he left the company within two years. That agreement had the phrase below the signatures "total training cost £2000". He left after seven months. He knows the training (from an external provider) cost a total of £950, but the company insists he pay them £2000 "because that was on the agreement". My friend has now received a solicitor's letter demanding payment of £2000 or they will take court action. (Incidentally they held his first two weeks wages 'in hand' and have not repaid these, which amount to £860, and this equates to almost all the actual training costs incurred).

I have two questions:

1 The £2000 was a pre-estimate of training costs but the actual costs were established just three days after the agreement was signed when he took a pre-assessment from the training company. Surely the actual costs (less than half the pre-estimate) override that pre-estimate, and there must be legislation to prevent companies using such an agreement as a penalty on the employee if they leave, or to make profit from the agreement. I've not been able to find any similar situations on my internet searches - does anyone know what legislation that governs this?

2 The agreement did provide a sliding scale of sorts to reduce the employees liability but is very skewed - 100% to be re-paid up to 18 months, 75% 18-21 months, 50% 21-24 months. Therefore the company is making absolutely no contribution to the training cost for the seven months benefit they received from his ability to drive the larger vehicles. (From looking at other such agreements online, the reimbursement liability usually reduces by 25% each six months). Is that legal or do they have to reflect some reduction in the costs reclaimed because of the benefit they got?

Thanks

[Johnboy007]

Re: Recovery of inflated training costs

5. Deductions from your payYour employer isn’t allowed to make deductions unless:

• it’s required or allowed by law, eg National Insurance, income tax or student loan repayments
• you agree in writing
• your contract says they can
• there’s a statutory payment due to a public authority
• you haven’t worked due to taking part in a strike or industrial action
• there’s been an earlier overpayment of wages or expenses
• it’s a result of a court order

A deduction can’t reduce your pay below the National Minimum Wage rate, even if you’ve agreed to it.

If you work in retail (eg shops, restaurants)
Your employer can’t take more than 10% from your gross pay (pay before tax and National Insurance) each pay period to cover any shortfalls.
Example
There’s a shortfall of £50 in your till and your employer wants to deduct this from your earnings.
You’re paid £250 gross per week. Your employer can take 10% of your gross earnings, which is £25.
They must only take £25 one week and then make another deduction from your next pay cheque for £25.
If you leave your job, they can take the full amount owed from your final pay

If you haven’t been paid in full

Speak to your employer first to try to sort the problem informally.
If this doesn’t work, talk to Acas (Advisory, Conciliation and Arbitration Service), Citizens Advice or your trade union representative.
You have the right to go to an Employment Tribunal to get your money.

If you quit your job

Check your contract to see if your employer is allowed to withhold your pay. Normally you’re entitled to be paid everything you earned up to the point you finished.
If you’re forced to resign as a result of your employer refusing to pay you, you might be able to make a constructive dismissal claim in an Employment Tribunal.

To make a lawful deduction from your pay, your employer would have to show reasons for doing so.
The £2000.00 below the signature is lawful according to the Bills of Exchange Act 1882

(1)A bill of exchange is an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to or to the order of a specified person, or to bearer.

(2)An instrument which does not comply with these conditions, or which orders any act to be done in addition to the payment of money, is not a bill of exchange.

(3)An order to pay out a particular fund is not unconditional within the meaning of this section; but an unqualified order to pay, coupled with (a) an indication of a particular fund out of which the drawee is to re-imburse himself or a particular account to be debited with the amount, or (b) a statement of the transaction which gives rise to the bill, is unconditional.

(4)A bill is not invalid by reason—

(a)That it is not dated;

(b)That it does not specify the value given, or that any value has been given therefor;

(c)That it does not specify the place where it is drawn or the place where it is payable.