Training clawbacks after Geeks Ltd v Watts: what employers need to review

You invest time and money training an employee, only for them to leave and use those newly acquired skills elsewhere. It is understandable why employers want to recover those costs. However, the recent Court of Appeal decision in Geeks Ltd v Watts [2026] shows that training clawback clauses must be carefully drafted and proportionate. 

Mr. Watts (W) joined Geeks Ltd (G) as a trainee quality assurance engineer on a salary of £18,000, rising over time to £22,000. Alongside his employment contract, W signed a separate training agreement creating an £8,108 “training cost debt”. 

The agreement provided that the debt would be reduced by one-eighteenth each month after W completed 12 months’ service. If W left before it was fully written off, the outstanding balance became repayable in monthly instalments. The agreement also stated that it was not intended to prevent W from taking other employment. 

After being refused an increase in salary for eight months, W resigned for a better-paid role. G sought repayment of the full £8,108, arguing that the clause protected its legitimate interest in maintaining a trained and stable workforce. 

Although G succeeded initially, the Court of Appeal found the clause was a restraint of trade because its practical effect was to discourage W from leaving. 

The Court focused on two key points: 

1. The clause was too broad. It applied regardless of the reason for departure, treating an employee leaving to care for a family member in the same way as one leaving for a competitor. That went beyond what was reasonably necessary to protect the employer’s interests. 

2. The financial burden was disproportionate. At £8,108, the debt represented a substantial proportion of W’s relatively low salary and created a significant barrier to leaving. 

What does this mean for employers? 

This judgment does not mean training clawbacks are no longer possible, but it does raise the bar. Employers should consider: 

• The practical effect, not just the wording. Calling a repayment obligation a “debt” will not help if, in reality, it prevents or seriously discourages an employee from leaving.  

• Proportionality. The amount repayable should reflect genuine, evidenced costs, such as external course fees, exam fees, or other identifiable training expenses.  

• Fairness and flexibility. Avoid blanket clauses that apply in every situation. Consider reducing repayment amounts based on length of service or the circumstances of departure.  

• Power imbalance. Employees should have a genuine opportunity to understand the agreement and seek independent advice.  
  

Training clawback arrangements remain available, but the clauses most likely to survive scrutiny will be narrower, better evidenced, and more closely tied to the employer’s legitimate interests.