The employer withholds the last salary to compensate for the training costs: is this an expense of the employer? | Fox Rothschild LLP

A thorny issue for employers is to train new hires, then get them to quit (for whatever reason) and end up with the training costs. What can the employer do? I think there are few options, but one risky option is not to pay the employee or withhold his salary when he leaves. A recent case is testing whether this strategy is legal. The case has the right Barker v. K. Dolan Conveyor Co LLC et al. and was filed in federal court in the Western District of Pennsylvania.

An ex-employee, a technician at a transport company, filed such a complaint, asking for two weeks’ salary which he said was illegally withheld to “pay” for the costs of the training. He alleges a violation of the Fair Labor Standards Act, the Pennsylvania Minimum Wage Act and the Pennsylvania Wage Payment and Collection Law. He alleges that “because of not having paid any salary to the complainant for his last week[s] of employment with the defendants, the defendants have not paid the plaintiff all wages owed and due. The worker was making $ 14 an hour.

The employee claimed that when he resigned he did not receive the equivalent of his last two weeks of pay. He claims that the Company’s position was that he should compensate the Company for the costs of his training. He personally sues the Company, an affiliate as well as the owner. He is claiming wage arrears for lost wages, as well as damages.

Takeaway meals

This could be a problem for the Company. Training costs are costs that a Ministry of Labor or a court could very well consider to be business costs that the employer must bear and cannot be passed on to the employee or deducted from his salary. If the employer has been doing this from the start, a class action lawsuit may well be brewing. One solution may be to have the employee sign a statement acknowledging that the training is to his or her benefit and that he voluntarily acknowledges that he is learning skills that he could take with him, thus giving a policy of deduction or reimbursement a legal basis.

It’s worth trying…

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