Bosses in industries such as retail, health care and logistics are reverting to an old tactic and trapping people in miserable jobs by threatening to saddle them with debt if they quit. Workers across the United States in fields ranging from nursing to trucking have been discouraged from leaving jobs they hate or can’t afford to keep because employers vow to charge them for training costs if they quit before an arbitrary deadline.
The threats are backed by so-called Training Repayment Agreement Provisions (TRAPs) in employment contracts. The practice has been likened by critics to indentured servitude and peonage — formerly common types of debt bondage in which a borrower was bound to perform labor for a creditor.
TRAPs have recently come under fire from policymakers because of class action litigation against the pet store chain PetSmart, and reporting on the restrictive covenants from a watchdog group called the Student Borrower Protection Center. Earlier this month, the Senate Banking Committee held hearings examining the agreements and other forms of employer-driven debt. In June, the Consumer Financial Protection Bureau also launched an investigation of employment arrangements that led to workers owing money to their bosses.
Categories: Economics/Class Relations