Reimbursement of training costs for employers

In our first article in the series on Training Cost Reimbursement for Employers, TNTP provided an overview of training relationships in labor. This article will explain in detail how employers can be reimbursed for training costs. Specifically:

1.Legal grounds for employers to seek training cost reimbursement

Employers may request training cost reimbursement from employees only when specific conditions under Vietnamese law are met, particularly those outlined in Article 62 of the 2019 Labor Code. These conditions include:

• A valid training contract must be signed: Employers can only request training cost reimbursement when both parties have established a written training contract. This contract must include all legally required elements: the training program, the location and duration of training, the training costs, the employee’s committed period of employment after training and responsibility for cost reimbursement if the employee breaches their commitment. If the employer provides training costs based only on verbal agreements or internal regulations without signing a training contract, the employee is not obligated to reimburse any training costs paid by the employer.
• Valid training costs must be proven: The employer must provide valid evidence of training expenses, including: course tuition fees, costs of materials and textbooks, travel and accommodation expenses (if any) and wages and compensation during the training period (if provided). Employees have the right to refuse reimbursement if the expenses either lack valid documentation or despite having proper documentation, do not represent or do not serve legitimate training purposes.
• Employee’s unilateral termination before the commitment period: The employer may only request reimbursement of training costs if the employee quits before completing their committed work period after training. Employees who fulfill their entire commitment period are not required to reimburse training costs, regardless of the employer’s investment. For employees who complete part of their commitment period, reimbursement may be prorated accordingly.
• Employee termination of labor contract not exempt from reimbursement: Despite the general requirement to reimburse training costs, employees are exempt in several situations when terminating their contract early. These exemptions apply in case where: the employer illegally terminates the contract or the employee resigns for justified reasons under Clause 2, Article 35 of the 2019 Labor Code, including cases of mistreatment, sexual harassment, forced illegal work, delayed or unpaid wages or unsafe working conditions. Under these circumstances, employees are not required to reimburse training costs, even if they have not fulfilled their committed period.

2.Training costs that must be reimbursed to the employer

According to Article 62 of the 2019 Labor Code, employees who violate their post-training work commitment may have to reimburse the employer for some or all training costs. However, reimbursement can only be requested for legitimate expenses that are clearly documented and conform to the terms of the training contract.

(i) Legitimate training expenses that employees must reimburse: Training expenses that employers may request employees to repay, as specified in the training contract, include:

• Tuition and training fees: These include course fees and tuition at domestic or foreign training institutions, as well as examination fees for training-related certificates and certifications.
• Learning materials and curriculum costs: These include books, materials and textbooks required for learning, as well as software or learning tool usage fees (if any).
• Travel and accommodation expenses during training: If employees must attend training away from their workplace, the employer may cover expenses including airfare, train or bus fares, other transportation costs, hotel accommodations, dormitory fees and living allowances. These expenses are only eligible for reimbursement when supported by valid invoices and documentation.
• Teaching and instruction costs: For internal training programs, companies may seek reimbursement for instructor fees, expert consultation costs or internal training expenses. These costs are reimbursable when supported by a formal contract between the employer and training service providers (companies or individuals).
• Salary and wages during training (if provided): If employees receive wages or allowances while attending training, the employer may seek reimbursement for some or all of these payments.

(ii) Invalid expenses (not required to be reimbursed) include:

• Expenses not specified in the training contract.
• Costs lacking valid supporting documentation from the employer.
• Nonspecific expenses without direct connection to the training course.
• Legally required training expenses (such as occupational safety training and periodic training).

3.How to resolve disputes over training costs

Labor disputes over training costs can be resolved through any of these options:

(i) Internal negotiation and mediation: Both parties can renegotiate the reimbursement amount and payment schedule.

(ii) File a complaint with the Labor Inspection: If the employer violates labor laws, employees may file a complaint with their local labor authority for investigation and resolution.

(iii) Labor mediators: If negotiations fail to resolve the dispute, either party can request assistance from the labor mediators.

(iv) File a lawsuit in People’s Court: If negotiations fail to reach an agreement, either the employee or employer may file the petition with the court for legal resolution.

Training cost disputes typically arise from conflicts over training contracts, employer reimbursement requests and reasons for employee contract termination. To minimize risks, employees should carefully review training contracts before signing. Employers must follow legal regulations and maintain proper documentation when requesting reimbursements. When disputes occur, both parties should attempt negotiation before escalating to authorities.

Please join us for our next article on “Disputes over training costs and the burden of proof for employers”. This piece examines common disputes about training costs and employers’ obligations when seeking reimbursement from employees. If you have any questions, please contact TNTP directly for assistance.

Sincerely,