A study expense clause in a Dutch employment contract protects the employer when an employee takes advantage of training or study opportunities provided by the employer. The purpose of a study expense clause in The Netherlands is to ensure that the employer receives a return on its investment in the employee’s training and to prevent the employee from leaving for another employer immediately after completing the training. However, the employer is not always required to fund and not every study expense clause is valid. Our Amsterdam employment law attorney Mr. Paul Snijders explains when a study expense clause is valid and requires an employee to repay.
Education or training necessary to perform the job
Article 7:611a BW paragraph 1 states that an employer who enables the employee to follow training that is necessary for the performance of his job must offer that training free of charge, if the Dutch Employment Law or a collective bargaining agreement requires it.
Professional medical specialist training is not covered by compulsory training
However, this does not apply to all mandatory training. It does not include professional training or training that employees are required to take in order to obtain, maintain or renew a professional qualification. For example, the training for “medical specialists,” “occupational medicine” and the training for “labor and health, occupational medicine” do not fall under the “compulsory training. Thus, these compulsory training courses do not have to be reimbursed by the employer. These are training courses that are mandatory to practice a certain profession. Often that training begins simultaneously with the start of work. Only when this training is completed, the employee may practice the profession independently.
Conditions for a valid education clause
For compulsory training, an employer may make agreements with an employee regarding reimbursement of study costs. Of importance here is a Dutch Supreme Court ruling of June 10, 1983, NJ 1983 / 796 (Muller/Van Opzeeland). This states exactly what a study expense clause must satisfy. The longer the employee is employed, the less he has to pay back.
- For compulsory training, however, an employer may make agreements with an employee regarding repayment of the study costs. Of importance here is a Supreme Court ruling of June 10, 1983, NJ 1983 / 796 (Muller/Van Opzeeland). This states exactly what a study expense clause must satisfy. The longer the employee is employed, the less he has to pay back.
- It must be an arrangement that clearly states the period of time the employer considers necessary to recoup the investment in the employee, and the amount involved.
- That amount decreases in proportion to the continuation of the employment. In short, the longer ago the training and the longer the employee is employed, the less he has to pay back.
If the employer has not clearly established this, then the entire study expense clause may be invalidated.
Recovery of study or training costs in violation of good employment practice?
In short, the mere fact that a study expense clause states that taking the course is necessary to perform the job does not mean that reclaiming the study expenses does not violate good employment practice. After all, not in all cases may the employee reclaim an amount of study costs.
Repayment obligation for vocational training with a medical specialist is valid
The Dutch Overijssel District Court ruled that a repayment obligation entered into with a medical specialist in training is valid. After all, a medical specialist has good job and salary prospects, so the trainee specialist can bear or finance a repayment obligation of over €45,000. Moreover, the trainee specialist had left his employer on his own initiative.
Drafting a valid study clause in an employment contract in The Netherlands
Thus, when drafting a study clause in an employment contract, as an employer you must pay attention to the following issues:
- Vocational qualification: is it vocational training that the employee is required to undergo in order to obtain, maintain or renew a vocational qualification, i.e. to practice a particular profession? The employer does not always have to offer this free of charge.
- Make sure the clause is worded clearly and understandably so that both parties know what is expected. Specify what types of training or study opportunities are covered by the clause.
- Costs: Specify up front to the penny who will be responsible for paying training costs, such as tuition, study materials and other relevant expenses. Those costs should also be itemized so the employee knows what financial obligations he is incurring.
Repayment arrangements
Establish clear terms for the repayment of training expenses by the employee if he leaves the organization within a certain period of time. Specify the amount to be repaid and the time frame within which this must occur. Also agree on repayment of these costs in a sliding scale if the employee leaves early. The longer in service, the less has to be paid back.
Contact a Dutch attorney employment law Amsterdam about study expense clauses
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