Nurse Breach of Contract

You have received a demand letter from your former healthcare employer demanding you pay back thousands of dollars in bonuses, training costs, or other bogus fees. You are understandably upset and appalled that the company would take this action, given that the company failed to live up to its end of the bargain. This unfair practice of demanding payment from nurses when they leave their employment has become increasingly common in the healthcare industry, especially in the for-profit healthcare industry in Tennessee.

Our Nashville labor and employment lawyers represent nurses who want to fight back against unfair demands for payment from their former employers.

In a competitive job market for nurses, some hospitals and other employers try to scare nurses into staying at undesirable jobs by threatening them with huge bills and debt if they quit. Sometimes they claim the demand for money is for repayment of training costs or of a signing bonus. Sometimes they claim it is for lost revenue, lost profit, or to make up for the cost of training a replacement. No matter what they call it, they may have threatened to sue you or take other action against you if you don’t pay up. Faced with a potentially devastating financial hit, some nurses feel they have no choice but to give in to their employer’s demands.

These demands are wrong. If you are a nurse who is being threatened with a large demand for money after leaving a job, there are steps you can take to protect yourself. In some cases, it is possible to avoid paying it entirely. Below are some laws that help Tennessee nurses fight back against these unfair demands.

Repayment as De Facto Noncompete Clause

The Federal Trade Commission (FTC) announced in January 2023 that it would be releasing new federal regulations that will prohibit most employers from using noncompete clauses to stop employees from seeking new jobs. Part of the proposed regulations address demands for payment of money when an employee leaves his or her job, especially when the money is for so-called “training costs.” Under the new regulations, which are expected to go into effect sometime in 2023, employers will no longer be allowed to demand this repayment from employees or to enforce similar provisions that have the goal of scaring an employee out of seeking a better job elsewhere.

Penalties Prohibited by Tennessee Law

Under Tennessee law, a nurse’s employment contract cannot require the individual to pay a random, set amount of money for breaking the contract. Provisions setting monetary penalties for breach of contract, often called “liquidated damages,” must be reasonably tied to the wronged party’s actual damages. Attempting to force someone to pay a set amount of money because they supposedly breached a contract is prohibited by Tennessee law when the purpose of the payment is to act as a penalty for breach. [Tenn. Code Ann. § 47-2-718.]

First Breach Doctrine & Unclean Hands

If one party to an employment contract breaches the contract, they often cannot then seek to enforce the contract against the other party. In other words, if a healthcare employer first violated your employment contract—for example, by failing to pay properly, failing to provide safe working conditions or breaks, or violating your rights—they cannot seek to enforce the employment contract against you. Especially in cases where your employer violated your rights in some way—such as when you have been the victim of discrimination, harassment, retaliation, or wage and hour violations—your employer may be willing to negotiate or waive any amount you supposedly owe them in order to keep you from pursuing legal claims against them.

Nurse Wage & Hour Law Violations

Under state and federal law, employers are required to pay all hourly workers at least the federal minimum wage ($7.25/hour) for all hours worked. If the amount your employer is demanding you pay is so large that it reduces your wages below this amount, they may be violating these laws. This is especially true if your employer has or is threatening to deduct some amount from your paychecks or to withhold your final paycheck.

Special Rules for Immigrant Nurse Workers

Additional protections apply to ensure that healthcare employers do not take advantage of immigrant workers. Under federal immigration law, employers are not allowed to seek reimbursement for business expenses, including most expenses related to the immigration process (including immigration attorneys’ fees and costs), tools and equipment, and travel and living expenses while traveling on employer business. Employers are also not allowed to charge immigrant workers a penalty for ending their employment unless the amount complies with state laws regarding liquidated damages clauses (discussed above). Finally, employers are not allowed to seek any money from immigrant nursing employees that reduces their wages below the prevailing wage for their position and area, as set by federal law.

Do Not Wait – Contact Us Today

If you are a nurse living or working in Tennessee who has been subjected to threats from your employer, it is never a good idea to ignore legal threats. But there are steps you can take to protect yourself. Do not wait to reach out to understand your legal rights, especially if your employer has given you a deadline.

Our law firm of skilled Nashville labor and employment lawyers fights for nurses who are the victims of unfair labor practices. If you believe your rights have been violated, contact us for a free online case review.