My Employment Contract Requires Me to Repay Training Costs If I Leave the Company, Is this Legal Under Florida law?
Does your employment contract include a provision that requires you to repay your company or organization for training costs if you leave your position? If so, you may be wondering: Is this type of contract enforceable in Florida? The short answer is ‘it depends.’ Florida courts may uphold a contract that forces an employee to repay training costs, but only when certain criteria are met, viewing these types of agreements as potential constraint on trade. Here, you will find an overview of the relevant Florida law and a brief discussion of some real world examples of these occurrences.
Florida Law: Valid Restraints of Trade or Commerce
In Florida, contracts that limit or prohibit competition are known as restrictive covenants. While restrictive covenants are generally disfavored, they may be upheld by Florida courts in limited circumstances. Under Florida Statutes § 542.335, a restrictive covenant is enforceable as long as it is reasonable in its scope, duration, and geographic location.
Florida courts analyze restrictive covenants, including requirements to repay for training upon separation, under Fla. Stat. 542.335. To be legally valid, a restrictive covenant must protect a “legitimate business interest”. State courts have determined that a requirement to repay training costs may constitute such an interest if the training provided was extraordinary or specialized.
Understanding the Law Through Real World Examples
Matthews v. City of Gulfport
The case of Matthews v. City of Gulfport centered around a police officer who brought several employment law claims against her former employer. Notably, she signed a contract that required her to repay the City of Gulfport for her training if she left the department within three years of taking the position.
In assessing this particular issue, the U.S. District Court for the Middle District of Florida observed that any contract that is suspected to impose a restraint on trade must be assessed under a “test of reasonableness.” State courts have consistently ruled that a reimbursement of training costs clause is reasonable as long as training is ‘extraordinary or specialized’. In this case, the employee did not challenge that the training was not extraordinary or specialized, and therefore, the District Court found that the reimbursement clause protected a legitimate business interest and the use of the reimbursement clause in her employment contract was reasonable.
Milner Voice and Data, Inc. v. Tassy
Another federal case of Milner Voice Data, Inc. v. Tassy provides a useful example of what type of training might be deemed extraordinary or specialized under Florida state law. In this case, a company sought to uphold a restrictive covenant against a former employee who received approximately $18,000 worth of training. The company sold and installed telephone systems—products with which the employee had no prior experience. The training provided by the company included training on the products it marketed, included compensation for multiple, multi-day, out-of-state training programs and national meetings, amounting to over $18,669.84 in tuition, expenses, salary and benefits for the courses. In reaching the conclusion that the training was extraordinary and specialized in nature, Judge Moore of The United States District Court for the Southern District of Florida looked to the fact that the employee did not have any experience or training on the products prior to his employment.
Contact a Florida Employment Lawyer to Discuss Your Case
Employment contracts are complicated. An experienced professional can help you understand your rights and responsibilities. If you have any specific questions or concerns about a contract provision that requires you to repay training costs or about your employment agreement in general, contact a Florida employment lawyer for legal guidance and support.