A link between payback clauses and training leave – the case of Poland

Lukasz Arendt, Iwona Kukulak-Dolata Department of Economic Policy University of Lodz Poland

VET instruments

Training course/ programme Payback clause Training contract Training leave Training fund

Training contract

• Training contract regulates the rights and duties of employees and employers, especially type of training, benefits, longer training leave period, duration of the payback clause (max. 3 years – the so called „payback time”) • Training contract must be signed if employer covers the cost of training and wants employee to work for the company after completing the training

Payback clause

• Is a part of a training contract • Obliges an employee to reimburse cost of training paid by the employer when an employee: ▫ does not undertake training when sent on the training by employer; ▫ decides voluntarily to discontinue training; ▫ decides voluntarily to discontinue the employment relationship with the employer ▫ is dismissed by the employer

•

Payback clause

The scale of reimbursement is proportional to the length of employment period after completion of training; • Is not applicable when: ▫ employee gives notice to terminate the employment because of mobbing; ▫ in case the employer is obliged to transfer an employee to another post (job position) because of harmful influence of current job on employee’s health and the employer does not fulfill this obligation but dismisses the employee.

Payback clause – stakeholders views

• Benefits for employers: ▫ ▫ ▫ Fosters employees’ human capital development; Lowers employees rotation; A way to lower the cost of labour • Benefits for employees: ▫ ▫ Fosters employees’ human capital development; Enhances stability and security of employment (important for implementation of flexicurity)

Payback clause – training leave

• Employee cannot refuse to sign the training contract if employer covers the cost of training • Signing the contract automatically means that the payback clause and training leave are applicable

Training fund – training leave

• Training fund – an instrument promoting lifelong learning defined in the Act on employment promotion and labour market institutions, passed on 20th April 2004 • Employers who set-up training fund may apply for financial support from the Labour Fund ▫ Reimbursement of up to 50% of training costs, not exceeding average monthly salary, for employees and employers aged up

to 45

▫ Reimbursement of up to 80% of training costs, not exceeding 300% of the average monthly salary, for employees and

employers aged 45 +

Training fund – training leave and…

• Reimbursement of training costs for employees on a paid training leave for more than 22 working days up to 80% of the average monthly salary • Reimbursement of the salary of an unemployed person involved in a job rotation programme, who replaces an employee on a training leave (up to 40% of the average monthly salary)

Summary

• • • Payback clauses are linked to training leave as a part of a training contract Additional link to training fund – a cost-sharing mechanism Lack of available data on the national level on the use of payback clauses – a similar problem as in case of training leave

Thank you for your attention

Lukasz Arendt Iwona Kukulak-Dolata Department of Economic Policy University of Lodz P.O.W. 3/5 90-255 Lodz Poland e-mail: [email protected]

e-mail: [email protected]