The impact of industrial relations and wage structures on repayment agreements for employer-financed training

Firms can use repayment agreements in order to protect their training investments in case a worker leaves the firm after training took place. In this empirical research note, I use linked employer-employee data to estimate the impact of industrial relations and wage structures on the probability that German firms make such repayment agreements with workers. Main findings are that firms with works councils are more likely to use repayment agreements, whereas union bargained collective contracts do not have significant effects. Moreover, firms with a larger intra-firm wage dispersion and higher mean wages are more likely to use repayment agreements.