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  • vickyp
    Keymaster
    Post count: 4922
    Forum: Community

    We are currently looking to update our educational assistance policy. Would it be legally enforceable to include a clause requiring repayment for any courses paid for by the company under the policy if the employee resigns within a 2 year period? Would the amount need to be pro-rated over the two year period or could the full amount be required for repayment?

    vickyp
    Keymaster
    Post count: 4922

    Yes, you can legally add this clause to your EA policy; however, enforcement of this clause may be problematic. Would you withhold a final paycheque? Would you expect the employee to cut you a cheque? Would you be forced into some financing arrangement?

    It might be worth considering making changes to your EA policy that require a certain tenure for eligibility, or a staggered reimbursement (50% upon completion, 50% the following year).

    Our EA policy at Bongarde has clauses that require the employee to pay upfront for the course, they get 50% reimbursed upon successful completion, and 50% after one year; they must also be an employee for a minimum of 1 year to take advantage. Lastly, if the employee cannot afford the tuition or costs, the company will make a zero-interest loan to cover the cost, this way we are on a much better legal ground for the recovery of this capital investment – as well, it allows the organization to clearly separate what is seen as a taxable benefit in some jurisdictions.

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