Requesting Employees To Reimburse For Training Costs And Keeping Employees’ Certificates Or Diplomas When Termining The Labour Relation Before The Binding Duration (part 2)

Requesting Employees To Reimburse For Training Costs And Keeping Employees’ Certificates Or Diplomas When Termining The Labour Relation Before The Binding Duration (part 2)

3. What is the practice of adjudicating the training costs reimbursement disputes at Courts?

 The trial practice in Vietnam shows that once the employees breach the commitment on working time, the employee must reimburse the enterprise for all actual expenses that the enterprise has paid for training. The judgement No.01/2017/LD-ST dated September 7th, 2017 of People’s Court of Hung Ha District, Thai Binh Province regarding “Dispute about vocational training” between the plaintiff, H Company and the defendant, Ms. Th.  Ms. Th joined H Company on January 4th, 2013, then was sent by H Company to study at Wuhan Cast – iron and Steel Quality Testing Center, China from May 10th, 2014, to August 2nd, 2014. Before attending the training course, Ms. Th had signed “The Commitment” that she had to commit to work for 3 years from March 31st, 2014, in case of violation, all training costs will be refunded to Company H.

However, on August 11th, 2015, Ms. Th quitted her job and was accepted by H Company, the parties signed “Letter of commitment to reimburse training costs due to violations of training commitments”. Accordingly, all expenses that H Company requires Ms. Th to pay including: Human accident insurance premium costs of VND 433,346, Business trip fee of VND 28,326,606, Visa fee of VND 1,267,200, Airplane ticket fee of VND 23,539,000, Meal fee of VND 21,392,719, Accommodation fee of VND 57,454,220, Training fee of VND 177,408,000 and Transportation fee in training time of VND 8,224,279, the total of which is VND 318,045,364.  After deducting the time Ms. Th worked at H Company, the training expenses that H Company claims are VND 209,997,076, in which training fee is VND 117,137,885. Ms. Th voluntarily refunded, and the payment is divided into many installments of VND 35,000,000. Particularly for the training fee of VND 117,137,885, Ms. Th did not agree to refund at the request of H Company, the reason is the agreement which H Company signed with the unit directly training at the Wuhan Cast – iron and Steel Quality Testing Center, China does not mention the training fee as tuition fee. 

The resulting settlement of the case is that People’s Court of Hung Ha District recognized the expenses that the parties have agreed and have valid documents such as Human accident insurance premium, Business trip fee, Visa fee, Air ticket fee, Meal fee, Accommodation fee and Transportation fee in training time after deducting the time Ms. Th worked at H Company. For training fee, People’s Court of Hung Ha District did not recognize because training fee is much larger than total remaining expenses but has no valid receipt. The documents regarding the training fee provided by H Company are not clear and did not specify how much the training expenses cost as well as was not unified for the same document. In addition, even if H Company provided the Court with a “certification document” of the unit directly training at the Wuhan Cast – iron and Steel Quality Testing Center, China regarding the fact that company sent Ms.Th as an employee on training course with the expenses of VND 177,408,000, the Court would not accept it.

 From the above practice, despite according the currently legislation, the trained person has the responsibility for refunding training costs to enterprises when violating employment commitments. However, in fact, enterprises must face many difficulties in proving the expenses spent on training for Employees, Apprentices. At the same time, the training costs recognized by the Court must be reimbursed as actual training costs having clear and valid documents and receipts. 

Another case is the judgement No. 02/2018/LD-PT dated August 16th, 2018 of People’s Court of Thai Binh Province regarding “Dispute about apprenticeship agreement” between the plaintiff, B Company and the defendant, Mr. Nguyen Quang L. An agreement existed between B Company and Mr. Nguyen Quang L that has a term from December 1st , 2014 to May 30th, 2017 and the committed working period of Mr L. is 24 months after his apprenticeship ended. After the probationary contract expired, Mr. L worked for B Company until June 22nd, 2017 but he did not sign the labor contract and he terminated the labor relation unilaterally. During his apprenticeship, Mr. L received vocational training from B Company and was sponsored all tuition fees, training expenses and monthly allowance under the apprentice program of B Company. Therefore, B Company sued Mr. L to ask for refund of the full training costs of VND 43,500,000 and the allowance of VND 82,127,000 that Mr. L received. During the lawsuit, B Company withdrew the petition for the legal action against Mr.L regarding the training costs of VND 43,500,000.

According, the court of first instance recognized the lawsuit claim of B Company and forced Mr. L to refund B Company the apprentice allowance of VND 82,127,000.  The entire content of the first instance judgment was appealed by Mr. L on January 12th , 2018. However, the court of appeals agree with the court of first instance, did not accept Mr. L’s appeal request, upholding the first instance judgment.

 In addition to training costs, the expenses as the allowances for the Trainee during the training process are also one of the expenses that the Trainee must reimburse to the enterprise if the Trainee violates the commitment of working time after training, even when the parties have not signed the labor contract. 

See more: Requesting Employees To Reimburse For Training Costs And Keeping Employees’ Certificates Or Diplomas When Termining The Labour Relation Before The Binding Duration (part 1).

4. Regarding the fact that the enterprise keeps the original diplomas and certificates of the Employees to ensure that the employees comply with the working duration or reimburse and compensate for training costs when violating commitments?

In fact, after completing the training courses, the Trained People and the enterprises will sign a labor contract, so that, parties can officially start the labor relation. Along with requiring Employees to sign agreements and commit to long-term work, many enterprises also force Employees to assign the originals of diplomas and certificates that they are granted after the training course in the duration that Employees commit to work. In many cases, agreements to keep an Employee’s diplomas and certificates are “implicit” understood and implemented by the Employees and enterprises. However, some more cautious enterprises will force Employees to sign authorizing documents to assign enterprises to keep, manage and use their diplomas and certificates for the entire committed duration.

Despite the above authorization, as the owner, the employees still legally have the right to cancel or terminate this authorization at any time to request the enterprise to return the diplomas, certificates to them. In reality, it is difficult for Employees to use this right before the end of the committed working duration. Particularly, in the context that the Employee actively terminates the labor relation before the committed duration, the Employee may not receive their diploma or certificate when they have not completed full compensation and reimbursement as requested by the enterprise. So, is it legal for an enterprise to keep diplomas and certificates of Employees? And how should Employees deal with this request of the enterprises?

According to labor laws, it is illegal for an enterprise to keep the originals of the Employee’s identity papers, diplomas, and certificates. Therefore, the enterprise’s detention of the Employee’s original diplomas and documents regardless of the period is a violation of the labor laws. Violating enterprises may be subject to administrative fines of up to VND 40,000,000 – VND 50,000,000.

From the Employee’s perspective, the fact that their diploma or certificate being kept by the enterprise is an infringement of their legal rights and interests. Then, the Employee can submit a complaint, requesting State agencies such as the Department of Labor – Invalids and Social Affairs at the district-level People’s Committee and/or the specialized labor Inspectorate to request administrative sanctions against the enterprise and request the return of diplomas and certificates. On the other hand, Employees can also apply the above-mentioned legal bases to negotiate with the enterprises on the reimbursement amount for training costs as well as to return their diplomas and certificates.

In general, the current regulations on reimbursement, compensation for damages relating to vocational training costs in Vietnam are still ambiguous. As a result, there is no unified system for enterprises and Trained People in the process of forming, participating, and implementing training agreements.

Disclaimer: This article is for general information only and is not a substitute for legal advice. Apolat Legal is a Vietnamese law firm with experience and capacity to advise on matters related to Employment. Please click here to learn more about our services and contact our lawyers in Vietnam for advice via email info@apolatlegal.com.