84% Employees To Pay For Their Training if They Quit Too Soon
Managers feel repayment agreements can prevent employees from quitting too early.
- The trend of asking people to pay back for their training once they quit an organization is becoming increasingly popular.
- But is it a fair way to retain employees? Or is it unfair to ask people to pay back for training that may not have helped them?
- Skynova recently conducted a study to understand the phenomenon better.
Most people would have experienced a job change in their lives. The last couple of years specifically witnessed trends, such as the Great Resignation, where people quit in droves across geographies. However, few people may have been charged for training after quitting. That said, according to a study by Cornell Survey Research Institute, almost 10% of its participants were covered by training repayment agreements or TRAPs. This means the company can charge them for training when they quit their jobs. And this phenomenon seems to be growing.
But is this a fair way to retain employees who want to quit? Or is it unreasonable to ask people to pay for training that may not have helped them? To understand the phenomenon better, Skynova recently surveyed both employees who were required to pay such a fee and managers regarding their views on charging for training. Here are a few insights.
See more: Create Opportunities for Growth To Retain Employees During Uncertain Times
Being Asked To Pay For Their Training Increased Retention
Employees differed in their views about whether the training in their organization was helpful. But first, how much did employees have to pay, and was it worth the cost?
The employees surveyed paid an average of $516 for their training. While blue-collar employees paid back an average of $430, white-collar employees paid back an average of $522. Interestingly, most people thought their training was worth the cost since only 10% felt it wasn’t. This may be surprising, considering some of the subject matter was job specific. That said, white-collar employees were more likely to say that the training wasn’t worth the cost. It may be possible that they may dislike paying a training charge above the student loans they already way.
The good news for employers is that training repayment agreement provisions (TRAPs) could help retain new hires. More than 75% of employees agreed that having to pay for their training if they left the company within a year would increase retention. Additionally, 77% of employees would be open to signing a training repayment agreement in their present job.
Most People Had To Pay if They Quit Before a Specific Date
Company policies vary regarding employees having to pay for their training within the organization. So, what kind of requests do employers make during offboarding, and how do employees respond to them?
About 84% of surveyed employees reported being told they would be required to pay for their training if they quit before a specific date. The average amount they had to repay was $352. This is a significant amount, given the current economic climate and high cost of living.
So, what would employees do if they wanted to quit the job but were bound by the repayment agreement? About 61% said they would wait for the specific date to pass. About 60% would leave and refuse to pay the fee, while 46% would quit and pay the fee. About 26% said they would leave a bad review for the organization. About 87% would try to negotiate a higher salary if they applied for a job with a training repayment agreement.
There were also differences in how different generations would respond to these agreements. For example, millennials were more likely to quit and pay the agreed-upon money. On the other hand, Baby Boomers were more inclined to leave and refuse to pay.
Managers Justify Repayment Agreements
Managers may have a different view on requiring workers to pay for their training. Here are a few insights on what they think.
Training workers cost employers a significant amount of money. According to the surveyed managers, training a new hire costs an average of $853. Understandably, a few organizations would require employees to pay at least part of the amount if they leave too early.
Given the phenomena of quiet quitting and quick quitting, managers also have a few strategies to prevent those situations. For example, according to most of them, making benefits unavailable until after three months (or 90 days) and not allowing paid time off (PTO) in the first 90 days would be the most effective ways to retain workers. About 14% of managers also said that they would charge employees for back pay if they quit the organization in the first 90 days.
Organizations have a good reason to retain employees, especially highly trained and talented ones. Managers said it takes an average of two years for an employee to be highly trained and that training is useful only if the employee sticks around for a long time. However, unfortunately, 43% of managers had lost highly trained employees in the past year.
See more: How To Use Technology to Recruit and Retain Talent in a Competitive Labor Market
Offer Better Incentives To Stay
Charging for their training when employees quit is increasingly becoming popular among organizations. However, it can be seen from the study that over 60% of employees would quit and refuse to pay. Many people would wait for 90 days to be over to quit. Moreover, employees who want to leave will find a reason. Hence, organizations should focus on alternative steps to engage and retain employees than threaten them. For example, providing a better work environment, better technology and tools to improve productivity, more tailored benefits, and more flexibility in work are a few things organizations should focus on to improve employee morale, engagement, and retention.
Do you think it is fair to ask people to pay back for their training once they quit? What other ways can organizations retain employees? Share with us on Facebook, Twitter, and LinkedIn.
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