More U.S. companies charging employees for job training if they quit & More Latest News

Simran Bal was shocked to learn that a beauty salon in Washington State had charged her $1,900 for training after she had left.

Bal claimed that the trainings were of low quality and were only relevant to the shop because she was already a licensed esthetician and had no need for them.

Bal's story is similar to that of dozens of individuals and advocates from the healthcare, trucking, retail, and other industries who recently complained to American regulators about the practice of some employers charging substantial sums of money for training to departing employees.

According to the Cornell Survey Research Institute, nearly 10% of American workers polled in 2020 were covered by a training repayment agreement.

Regulators and lawmakers in the United States are looking closely at the practice, which detractors refer to as Training Repayment Agreement Provisions, or TRAPs.

Senator Sherrod Brown is researching legislative options on Capitol Hill in preparation for introducing a bill to curtail the practice the following year, according to a Senate Democratic aide.

Attorneys general at the state level, like Minnesota's Keith Ellison, are evaluating the practice's prevalence and may update the law.

While it "could be different" if an employer wanted reimbursement for training for a certification like a commercial driver's license that is widely regarded as valuable, Ellison told Reuters that he would be inclined to oppose demands for reimbursement for job-specific instruction.

The Federal Trade Commission and Justice Department have both received complaints about the practice, and the Consumer Financial Protection Bureau has started an investigation into it.

Despite low unemployment, the use of training agreements is increasing, presumably giving workers more power, according to Jonathan Harris, a professor at Loyola Law School in Los Angeles.

Employers are looking for strategies to prevent employee turnover without increasing pay or enhancing working conditions, according to Harris.

According to a CFPB official who was not authorized to speak on the record, the bureau, which announced in June that it was looking into the agreements, has started to concentrate on how they may make it difficult for skilled workers with years of education, like nurses, to find new, better jobs.

The official stated, "We have heard from workers and worker organizations that the products may be limiting worker mobility.

Since the late 1980s, TRAPs have been used sparingly, mostly in high-paying jobs where employees received beneficial training. But, according to Harris of Loyola, the agreements have spread more recently.

The National Federation of Independent Business, or NFIB, was among those who criticized the CFPB's efforts, claiming that the problem fell outside the agency's purview because it had nothing to do with consumer financial goods and services.

"CFPB should defer to those governments, which are closer to the people of the states than the CFPB," it continued. "(Some state governments) have authority to regulate employer-driven debt.

NURSING AND TRUCKING

When Bal was hired by the Oh Sweet salon outside of Seattle in August 2021, she expressed her happiness.

But she quickly discovered that she had to go to trainings on things like sugaring to remove unwanted hair and lash and brow maintenance before she could offer services to clients and earn more.

She claimed that the salon owner took a while to schedule the trainings and that they occasionally had to be rescheduled or cancelled. Bal worked at the front desk, which paid less, while waiting to finish the training, but they were also not informative; he described them as "introductory level."

Bal was given a bill for $1,900 for the instruction she did receive when she left in October 2021. Bal complained that "she was billing me for training for services that I was already licensed in."

Oh Sweet LLC's Karina Villalta filed a lawsuit in small claims court to get the money back. According to court documents that Bal has provided, the judge dismissed the case in September after determining that Bal had not received the promised training and owed nothing. Villalta turned down inquiries for comment.

National Nurses United stated in comments to the CFPB that they conducted a survey and discovered that the agreements are "increasingly ubiquitous in the health care sector," with new nurses frequently affected.

According to the study, 326 of the 1,698 nurses who participated in the survey had to pay their employers if they left their jobs before a set time, and 589 of the 1,698 nurses were required to complete training programs.

Many nurses claimed that before starting work, they were not informed of the training repayment requirement, and that classroom instruction frequently repeated what they had already learned.

Repayment requirements for training were "particularly egregious," according to the International Brotherhood of Teamsters, in the commercial trucking industry. Companies like CRST and C.R. The cost to obtain a commercial driver's license in England is $6,000 or more, depending on when the applicant leaves the company. An inquiry for comment was not answered by either business.

The American Trucking Associations contends that the license is government-mandated and transferable from one employer to another. It requested that the CFPB refrain from referring to it as employer-driven debt.

The issue merited investigation, according to Steve Viscelli, a sociologist at the University of Pennsylvania who spent six months training before beginning to drive a truck.

He said, "We should always be asking why we have training contracts for low-skilled workers. "You don't need a training contract if your job is good. People will want to remain."