In order to cover the case where the worker`s final salary is not sufficient to recover the outstanding loan, the loan contract should include the obligation for the employee to make a separate payment to the organization within a specified period after the termination of the employment or to repay the outstanding under a schedule agreed with the employer. The loan agreement should specify that if the loan is not repaid in accordance with the agreement and, if applicable, to an agreed repayment plan, the organization may take legal action to recover the outstanding. Therefore, in order to ensure repayment of a loan when the employment is terminated for any reason, the employer should include in the employment contracts a clause stipulating that it has the right to make deductions from the worker`s salary for various purposes, including the repayment of an outstanding loan. On appeal, Hassey argued that the refund agreement violated FLSA`s minimum wage and overtime requirements because he had not received his wages unconditionally. In particular, he submitted that he would be paid during his activity under the repayment agreement on the „condition” that he reimburse the training costs if he left before the expiry of a five-year period. The court rejected Hassey`s reasoning. The refund agreement prompted staff to stay in the policy. The Tribunal found that the mere fact that the reimbursement agreement increases the change of employment does not mean that the employee`s wages were not paid „freely and clearly”. On the contrary, Hassey received his salary during the training, and no deduction was made on his salaries for training expenses. The employer selects and sends police apprentices to the Oakland Police Academy.
To encourage police officers to remain in the police force, the employer has reached an agreement with the Oakland Police Officers Association to ask officers to reimburse training costs when they leave the police department before five years of service.