A client of ours at FLCC suggested this blog topic. He, as all of us currently operating businesses are, finding skills-gap training a necessity with time and cost to acclimate employees at an all-time high and employee retention at an all-time low in the workforce, far beyond the trade shortage. It extends to construction management and administrative and accounting personnel beyond years past. Industries, including ours, that teach skilled trades implement formal job training programs, and often those programs include skin in the game for both the employee and the employer for mutual buy-in, commitment, and overall success.
So where does the term TRAP enter? TRAP in employment stands for Training Repayment Agreement Provision. These provisions put a price on the cost to an employer to train an employee. If that employee quits or is terminated because of insubordinate behavior, severe underperformance, or job abandonment, then the employee can be responsible for reimbursement of some or all of the training costs if the employee commitment was not honored. Companies that have formal training programs and dedicated training professionals are typically those who are successful in both managing and collecting on TRAP program repayment fees.
An article in Forbes from 2021 refers to an Ohio Roofing product sales company’s success in winning a TRAP case against salespeople, and the article mentions that electrical training programs are often designed with a repayment provision.
Each state is different, and California, to an extreme of Florida, for instance, proposed legislation prohibiting any form of restrictive covenant from an employer. 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 (source: Florida.org).
My take after over twenty-five years working with matching human capital with the right employer for mutuality, I find three major disconnects that often happen.
- Individuals think they bring more value to an employer than they do, especially out of the gate.
- Most employers think they have industry secrets, whereas they have their business model, clientele, and product mix.
- Both sides form expectations of each other and the job and assume they are aligned during the interview and negotiation process.
These three disconnects end up in the training bucket from an employer perspective, yet from a legal view, they are simply employer preferences and expectations to stay employed with their company. Therefore, titles are often deceptive, and the process of administering a project itself can be ambiguous in the construction industry.
Training on how and when you would like things done, communicated, and documented within your company does not qualify as formal training and admissible to collect on in a restrictive covenant case. An analogy would be like hiring a personal chef who knows how to make eggs but must learn if you like them fried, over easy, or scrambled. You not only like them fried, but over easy, flipped twice, and lightly salted as your preference and expectation each morning. The chef knows how to cook. He has to learn how to cook for you. A candidate who has been a construction manager may manage projects, but do they and will they do it to your preference and level of expectation?
TRAP programs are designed for when an individual is receiving on-the-job training in a field or profession they have not been employed in before, and you are (1) giving them that opportunity to learn the job, industry, profession, and (2) teaching skill sets they will carry with them for life that they may need to pay for otherwise with monetary means and not sweat equity to learn. This is similar in nature to an academic study contracted on a fee basis where the individual commits to the price whether they choose to continue or not show up. If terminated from the program; they still must pay. If serving the time, they have to maintain a passing grade.
Employers, if you are hiring and training those coming into the profession with little or no baseline, then by all means dial in your training program to have the back-up needed to collect on non-performers in court. After all, you are giving them a chance at a new career. If you are an employer who just wants to shore up your turnover costs, change your approach on an interview to not only asking what they have done but also digging into understanding how they actually do it in comparison to how you will expect it to be done. You might find that the chef you are thinking to hire makes fried eggs but breaks every other yolk, and you would make him throw those out as unacceptable not only as a preference but for time, cost, and presentation. Ultimately, you would fire him, or he would quit because of your obvious daily rejection. Similarly, a construction manager who can process an RFI but doesn’t read and review them might not meet your expectations. Don’t fool yourself; there are individuals and companies at all different levels of professionalism doing what might be considered the same tasks but without high standards. When hiring, don’t get trapped by thinking that training a new employee in your professional way falls under formal training. It falls under that they don’t know what they haven’t been taught or required in the past to do. Now, exposing them to your clients and tools can be protected with restrictive covenant in Florida and many other states. Your lack of time spent understanding on an interview, during onboarding, and throughout their employment as to what they are already trained in or capable of learning is not.
Henry Ford used to say, “The only thing worse than training your employees and having them leave is not training them and having them stay.”
The best retention programs come with clear expectations set and repeated often. Recaps help align expectations. When you align expectations, you are not correcting dissatisfaction but emphasizing accomplishment. You are never too far off course to feel trapped or wish you had a TRAP because someone is leaving after you invested time and resources on them. Do you make time to recap? (Realign Expectations Communicated Among People.)
To Recaps to Prevent Traps,