Payback: employer could recover recruitment expenses

A clause requiring an employee to repay training or other costs incurred by an employer if the employee leaves employment within a certain period of the costs being incurred may be a penalty. If it is a penalty, because the purpose of the clause is to stop the employee from leaving employment rather than a genuine attempt to compensate the employer for its loss, it will not be enforceable.

In Cleeve Link Ltd v Bryla, the Employment Appeal Tribunal (EAT) considered whether a repayment clause relating to certain recruitment costs incurred by the employer in hiring the employee was unenforceable as a penalty. If so, the employer made an unauthorised deduction from the employee’s wages when it deducted the recruitment expenses from her final salary payment…

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