Have you been offered a settlement agreement and is there also a training costs clause in your employment contract? You may be at risk of having to repay a substantial sum to your employer. Fortunately, this is far from always justified, and the settlement agreement negotiation actually presents opportunities to get this clause off the table. In this article you can read when a training costs clause is valid, when it is not, and how to deal with it when terminating employment by mutual consent.
What is a training costs clause and when does it apply
A training costs clause is an agreement in your employment contract or a separate training agreement, whereby you reimburse your employer for training costs they have paid if you leave within a certain period. The employer invests in your knowledge and expects you to apply that knowledge within the organisation for a number of years.
Such a clause is not laid down in a specific statutory provision, but the Supreme Court ruled as far back as 1983 (the Muller/Van Opzeeland case) on the requirements it must meet in order to be valid. Since then, a clear framework has also emerged in case law.
To be legally valid, a training costs clause must satisfy at least three conditions:
- It must be set out in writing how long the employer is deemed to benefit from the training (the so-called benefit period).
- The repayment obligation must decrease on a sliding scale the longer you remain employed after completing the training.
- The financial consequences must have been clearly explained to you in advance; you must not be faced with any surprises.
Furthermore, the clause must have been agreed in writing before the training began. If you never signed anything before the training started, your employer cannot hold you to it after the fact.
When is a training costs clause void
Since 1 August 2022, additional statutory restrictions have applied following the introduction of the Act on Transparent and Predictable Employment Conditions. This Act extended Article 7:611a of the Dutch Civil Code. The key point: if the training is compulsory under legislation or a collective agreement in order for you to perform your role properly, the employer must offer that training free of charge. A training costs clause for such a compulsory training is therefore void by operation of law.
In short: if your training was necessary for the performance of your current role and that obligation stems from legislation or an applicable collective agreement, you do not need to repay those costs — even if there is a clause in your contract.
Please note: there is a distinction between training that is necessary for your role and training you undertake for career progression or personal development. If you pursue a course on your own initiative or with a view to a different role in the future, a training costs clause remains possible in principle.
The training costs clause in a settlement agreement
In a Settlement Agreement, the training costs clause comes into play in a particular way. Your employer has taken the initiative to end the employment. That very fact works in your favour during negotiations.
The Supreme Court has ruled that an employer may be acting contrary to reasonableness and fairness if they hold you to a repayment obligation when they themselves took the initiative to terminate the employment. This makes the training costs clause a serious point of negotiation in many settlement agreements where your employer is the driving force behind the dismissal.
Plan een vrijblijvend gesprek en ontdek wat we voor je kunnen betekenen.
Plan een gesprekSet-off against the final settlement
Also be alert to set-off. Employers sometimes quietly offset training costs against the final settlement. This is permissible in principle, but only as long as you retain at least the statutory minimum wage. Your employer may never withhold your salary in full to cover training costs. Make sure the settlement agreement explicitly states what will happen with the training costs clause, so that any surprises at the final settlement stage are avoided.
How to negotiate the training costs clause away
The good news is that when negotiating a settlement agreement you have every opportunity to negotiate on the training costs clause. Employees assessing a settlement agreement often focus solely on the severance payment, but a generous payment is of little value if you then have to settle a substantial training debt. Always include the clause explicitly in the negotiation process.
Practical tips for your approach:
- Check whether the training costs clause was agreed in writing and before the training began; if not, the clause may already be invalid.
- Establish whether the training was compulsory for your role under legislation or a collective agreement; if so, the clause may be void under Article 7:611a of the Dutch Civil Code.
- Check whether the clause contains a sliding scale and whether the repayment period has already (partially) elapsed.
- Make it clear during negotiations that the employer took the initiative to end the employment; this weakens their position when it comes to enforcing the clause.
- Agreeing in the settlement that the training costs are fully or partially waived is often open to discussion, particularly where the employer has an interest in a swift resolution.
- Have the settlement agreement reviewed by an employment lawyer before you sign; that way you can be certain there are no hidden set-off clauses.
Fixed-term contracts and training costs clauses
Are you on a fixed-term contract and has your employer decided not to renew it? In that case, reclaiming training costs is particularly difficult to justify. Courts take into account whether your contract was for a fixed or indefinite term. With a fixed-term contract, your employer is expected to inform you more explicitly about the financial risks of the training costs clause. If they fail to do so, the clause may be disapplied.
Why Arbeidsjurist Eindhoven
A training costs clause in a settlement agreement is a commonly encountered stumbling block for employees in the Eindhoven and Brabant region. The playing field is complex: when is the clause valid, when is it void, and what is open to negotiation? Arbeidsjurist Eindhoven can help you answer those questions concretely. We assess your situation, test the clause against current legislation and regulations, and support you in negotiations with your employer. Get in touch for a no-obligation initial consultation — you will quickly know where you stand.
Frequently asked questions
Do I always have to repay training costs in a settlement agreement?
No, that is not automatically the case. If your employer took the initiative to end the employment, it may be contrary to reasonableness and fairness to hold you to the repayment obligation. Furthermore, the settlement agreement negotiation offers the opportunity to agree that the training costs clause lapses or that the costs are waived.
When is a training costs clause void under the 2022 legislation?
Since 1 August 2022, Article 7:611a(4) of the Dutch Civil Code provides that a training costs clause is void if the training was compulsory under legislation or a collective agreement in order for you to perform your role properly. The employer must offer such compulsory training free of charge and may not pass the costs on to you.
What is a sliding scale in a training costs clause?
A sliding scale means that the repayment obligation gradually decreases the longer you remain employed after completing the training. For example: in the first year you repay 100%, in the second year 66%, and in the third year 33%. If such a scale is absent, the clause may be invalid.
May my employer offset training costs against my final settlement in a settlement agreement?
Set-off is permissible in principle, but only if you still receive at least the statutory minimum wage after the set-off. Your employer may not withhold your salary in full. Always ensure the settlement agreement explicitly states what will happen with the training costs clause and the final settlement.
What if I never signed the training costs clause before the training started?
A training costs clause must have been agreed in writing before the training began. If you signed nothing before the training started, the clause may not be legally valid and you can dispute the repayment obligation. Your employer cannot compel you to sign something after the fact.
We are happy to think along with you. For advice tailored to your situation we would gladly sit down with you. No rights can be derived from the content of this page and it may contain inaccuracies.
