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NSW Deduction from Employment Entitlements for Training Costs?

Discussion in 'Employment Law Forum' started by DissapointedEmployee, 10 March 2015.

  1. DissapointedEmployee

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    This is kind of a long story, so I'll do my best to keep it factual and brief.

    I've recently ended my employment from a company after being there for 7 years. My original employment contract which I had signed in 2008 has nothing in regards to the reimbursement of training costs Several years later, my employer attempted to introduce an internal training policy that stipulates that all training costs are to be repaid to the employer if the employee leaves the company within 24 months. At the time this policy was distributed to staff, I declined to accept those terms (as it seems a little to ambiguous, and in my industry, training costs could easily exceed $10,000 within a 2 year period), and did not sign the document as they had requested. No discussion was had on the matter, despite my requests to address the issue.

    Fast forward about 18 months later, and my employer approached me, as they wanted to send me on a training course that was required for me to obtain the skills and knowledge to support and manage internal infrastructure that they had invested in. The initiative for this course was entirely on their behalf. They reminded me of the reimbursement of the training costs should I resign within 24 months, at which point I reminded them that I had not signed that internal policy, and further questioned why I should be financially responsible for obtaining the training required to support their own internal infrastructure. My manager said "I'll get back to you", and I should just book the course - so I did. No further discussion was had.

    Fast forward 6 months, and I resigned. They told me that I owed them the cost of the course, which amounted to $4,500 - a figure that had never been mentioned until now. When I reminded them that I had never agreed to the training policy. They said it didn't matter, as my original employment contract I signed in 2008, had an item that says that I would "comply with internal policy changes as varied from time to time".

    I directed them to the Fair Work Act 2009 which says that for an employer to deduct from a employees entitlement, they must be primarily for the employee's benefit, and the employer must have consent, in writing, from the employee. Something which they don't have. They then said at this point that they would be deducting the amount from my final leave entitlements, because it would be cheaper for them to do that, than it would be to pay me what they owe me, and chase me for it later.

    It turns out that my leave entitlements didn't amount to enough to cover the cost of the training, so the next day they ended my employment 2 weeks early. I received my final payout letter, and they had deducted the entirety of my leave entitlements, in addition to 2 weeks wages.

    I took this issue to Fair Work Ombudsman, who said the best they could do was try and set up a meeting with me, my employer, and a mediator from Fair Work Australia, in hopes to resolve the dispute. My employer declined.

    So here I am. I now need to decide whether this is something I should pursue with the small claims court. The only thing that's preventing me from making the decision, is whether their justification of the fact I signed some other document that says I would agree to all internal policies and procedures holds any merit for their side of the argument. As much as I would love to take them to court and "stick it to em'" given the severe financial impact his has had on my personal life, I need to make sure I'm attacking this tactically, and not emotionally.

    Any advice on employment law any one could provide, would be greatly appreciated.
     
    WarrenH1244 likes this.
  2. hlly

    hlly Well-Known Member

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    You should pursue this because you have a good case and it's a significant amount of money. Visit a community legal centre for legal advice.
     
  3. Rod

    Rod Well-Known Member

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    Get paperwork from the FWO that clearly shows what you are owed. This can then be used in court.

    You can then take the matter to court yourself, either the local magistrates court or the Federal Magistrates court. One advantage of DYI vs using the FWO is that you can apply for civil penalties that come to you :) If the FWO takes the employer to court and asks for civil penalties and get them, the penalty goes to the government.

    You can use a lawyer and if you win you'll get back between 50% and 70% of your costs in a costs order. Else if you are confident in your ability to read and interpret the Fair Work Act and the relevant Modern Award you can DIY.

    There's a good chance the employer will settle before court as it sounds like you have a good case. In your court paperwork you may need to say your are seeking penalties and costs.

    Let us know how you go.
     
    DissapointedEmployee likes this.
  4. Rod

    Rod Well-Known Member

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    By the way, if it is the magistrates court, see if there is an industrial division you need to apply through. There is an industrial division in Vic that not many know about, including people staffing the local suburban courts :( I found this out when I enquired at my local court and they knew nothing about this special division.
     
  5. DissapointedEmployee

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    With my discussions thusfar with the FWO, they've told me that they have had their "power" stripped from them in recent times. They are unable to make any kind of order against my employer, or act on my behalf. They wouldn't even comment on the details of the issue - as to who is right or wrong. They are simply there now to act as a mediator and advise objectively to both parties, in attempts to resolve issues before taking them through the legal system, in order to mitigate the government costs of having it go to court.

    It's somewhat of an injustice for someone in my position - the little guy. I turn to the FWO to help protect me from being taken advantage of, or flat out wronged by my previous employer, and the only information they provided was a website that details how to take them to court. My previous employer has the full force of a legal team behind them, whilst I need to somehow come up with the cash for a solicitor, or try my luck at handling it alone. I feel very overwhelmed and out of my depth in regards to the ins and outs of contract law, and employee rights - which is why I came here seeking advice as to whether this is something I should try and pursue on my own.

    In regards to the issue at hand, I feel my case is very strong. I've got what I believe to be solid documentation to back up my argument, however I did present all this to my employer previously. The fact that they aren't convinced, and their legal council advised them to take my entitlements regardless, makes me think they know something I don't.

    The only two pieces of information they have that could possibly work to their favour, is that;
    1. I signed a document to stay that I "agreed to comply with internal policy changes as varied from time to time"
    2. I think I also did sign a document that said I would pay back training costs, however it was my understanding at the time that this only applied to the training courses listed on the document to which this clause was included. The course they are seeking is not listed on there.
    My rebuttal to those points are:
    1. When I started working there, we both signed a contract of my employment that dictated the terms, which included agreed remuneration. They cannot change this via an internal policy. There is no way to force me to comply to internal policies. Internal policies and procedures are not contracts, they more or less dictate the way they would like the company to operate - such as dress code etc. It is my understanding that my non compliance to internal polices or procedures simply allow them grounds for my dismissal after adequate warnings.

    2. The document signed which included something about the reimbursement of training costs, also included a list of courses I had agreed to complete in order to reach my KPI's and obtain a bonus at the end of the year. The course I was sent on was instigated by the company (ie, i didn't request to go on the course - they approached me as they needed someone to do it and I agreed) and was not listed on that doucment. At no point was the amount of the training course disclosed to me. How am I meant to make an informed decision if that kind of information is withheld? I believe they were purposeful in being deceptive, instead of being honest and up-front, in order to trick me into going on the course, so they could gain the immediate benefit of me being trained, with the expectation that I would foot the bill.
    That being said, i'd really appreciate your input on both sides of the argument. If you could help me identify any additional angles that they might try to exploit in order to swing the case in their favour, that'd really help me in being able to research and defend against it.

    I'd also be very interested in hearing what kinds of additional penalties or costs I could claim for.
     
  6. Rod

    Rod Well-Known Member

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    Are you covered by a Modern award? The FWO should have told you which award covers your employment. If yes, read the modern award provisions very carefully.

    Read up on the Fair Work Act to see if you can also apply for civil penalties. Some mistakes by employers have monetary penalties for each breach.

    Might be good now to pay for an hour or 2 of an employment lawyers time, but only after you've done a bit more research so you get the best value for your money.

    Ask for a copy of the training document you signed.
     
  7. DissapointedEmployee

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    Just to give all those watching an update on this, I've spoken to a solicitor and gained some documentation which defines, to the word of the law, why what my previous employer has done is illegal. Unfortunately for me, obtaining this information was rather expensive.

    The way i figure it at this point, is that we're past the point of compromise. I gave them plenty of opportunities to discuss the issue with me, and having to seek legal advice is a path they had forced me down, which has been of great personal financial burden. Now armed with the knowledge of the law surrounding these exact circumstances, the compromise for my previous employer is now to simply not go to court.

    I've just sent sent them a final letter of demand with the information from the solicitor attached, providing them a final opportunity to pay me my entitlements, and my legal costs so far. I've presented them with the ultimatum that if i do not hear from them within 10 business days by way of payment, or direct contact, they will leave me no choice but to take them to court.

    I chose to give them a final opportunity to make good on their unlawful actions as I feel it would be the best outcome for all involved. I get what is owed, and they don't go to court and get a civil penalty judgment made against them. Additionally, in the event that they are too stubborn to realize this (which honestly I believe is the way its going to go), it will be another notch in my belt to show the court that I have tried every possible avenue to resolve the problem outside of the court. They don't like it when you waste their time.

    So now we play the waiting game. My employer will either see that what they have done is wrong, and pay me my entitlements back, or we'll go to court, and I'll get them back that way.
     
  8. Rod

    Rod Well-Known Member

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    Thanks for the update. Looking forward to hearing your progress.
     

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