Payback clause

PDF Version
Name of the instrument - Local language
Payback clause
Name of the instrument - English translation
Payback clause
Scheme ID
239
Country
Ireland
Reporting year
2020
Type of instrument
Payback clause
Sub-type of instrument
Payback clauses are possible with no explicit limitations
Type of entry
Single instrument
Short description

Employers and employees can agree on a pay-back clause. There are defined eligibility requirements for these arrangements. Employers may calculate the specific schedule of reimbursement of training costs, but such training agreements usually stipulate a reimbursement according to the period between the end of the training and the resignation of the employee: a reimbursement of 100% of the training costs if the employee resigns within 3 months after completing training; 75% reimbursement after 3 to 6 months; 50% after 6 to 9 months and 25% after 9 to 12 months. One year after training, employees are not usually asked to reimburse training costs.

Level of operation
National
Name of a part of the country
Not applicable
Name of the region (for regional instruments)
Not applicable
Name of the sector (for sectoral instruments)
Not applicable
Relevance
Further instrument
Section 5 of the Payment of Wages Act, 1991
Objective(s) and target(s)
No official objectives. Payback Clauses are legal under the Payment of Wages Act (1991) but have to be compliant.
Year of implementation
1991
Operation/management
According to 'Chambers Ireland' (38), payback clauses can be contained in employment contracts.
Eligible group(s)
All employers
Group(s) with preferential treatment
No preferential treatment
Education and training eligible
Defined in the contract between employer and employee.
Source of financing and collection mechanism
Employer funds training, employee provides (partial) repayment eligible training costs in case of premature depature from the company
Financing formula and allocation mechanisms
Employers may calculate the specific schedule of reimbursement of training costs, but such training agreements usually stipulate a reimbursement of 100% of the training costs if the employee resigns within 3 months after completing training; 75% reimbursement after 3 to 6 months; 50% after 6 to 9 months and 25% after 9 to 12 months. One year after training, employees are not usually asked to reimburse training costs.
Eligible costs
Defined in the contract between employer and employee.
Volumes of funding
There is very little evidence of the frequency of the use of payback clauses in Ireland.
Beneficiaries/take up
Not applicable
Organisation responsible for monitoring/evaluation
Not applicable
Most relevant webpage - in English
http://www.irishstatutebook.ie/eli/1991/act/25/enacted/en/html
Recent changes

No recent amendment

Recent changes in response to COVID-19

No changes

Sources
Section 5 of the Payment of Wages Act, 1991: http://www.irishstatutebook.ie/eli/1991/act/25/section/5/enacted/en/htm…
On this page: