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  1. What We Do
  2. Workplace Debt & Labor Exploitation
  3. Stay-or-Pays & TRAPs

Stay-or-Pays & TRAPs

Protecting workers from employer-driven debt traps.

Every year, tens of millions of Americans leave their jobs. But for many of them, this can come with a surprise: a bill. That’s because more employers are relying on “stay-or-pay” contracts to trap workers, requiring them to pay a penalty if they leave a job.

The most common type of stay-or-pay contract is a Training Repayment Agreement Provision (also known as a TRAP). TRAPs and other types of stay-or-pay contracts are often forced on workers as a condition of employment, allowing corporations to use the threat of debt collection or litigation to lock workers in place, limiting their mobility and bargaining power, and leveraging crushing financial penalties when a worker does dare to leave.

What We’re Doing

If left unchecked, stay-or-pay contracts have the potential to leave workers buried in debt just for taking a better opportunity or for having to quit a job to navigate personal hardship. That is why Protect Borrowers has engaged in advocacy, policymaking, and litigation at the federal, state, and local levels to protect workers from stay-or-pay contracts. Read more about our work below!

Featured Investigations

Trapped At Work

Read Here

In this report, we document the widespread and accelerating use of Training Repayment Agreement Provisions (TRAPs) by big businesses, which often control a large market share of their respective industry, affecting millions of workers every day—from trucking companies, to hospital operators, to retailers, and even financial services firms. We estimate that major employers rely upon TRAPs in segments of the U.S. labor market that collectively employ more than 1-in-3 private-sector workers.

Stay-Or-Pay Compendium

Read Here

This paper series details how rather than ushering in a golden age of corporate investment in workers, the largest employers across the economy have turned to predatory “Stay-or-Pay” contracts. These contracts are forced on workers as a condition of employment, allowing corporations to use the threat of debt collection or litigation to lock workers in place, limiting workers’ mobility and bargaining power.

Featured State advocacy

Traps State Legislative Toolkit
New York’s Trapped At Work Act
Trump-era State Traps Advocacy

Featured Legal Challenges

LAWSUIT AGAINST SMOOTHSTACK FOR ITS USE OF TRAPS, O’BRIEN V. SMOOTHSTACK

Lawsuit Here

Lawsuit against PetSmart for its use of TRAPs, Scally v. PetSmart

Lawsuit Here

Lawsuit against Ameriflight for its use of TRAPs, Fredericks v. Ameriflight

Lawsuit Here

Featured Deep Dive Series

  • Jul 31, 2024

    Deep Dive: When Employers Turn Employees into Consumers, State and Local Regulators Can Turn to Consumer Protection Law

    This SBPC Deep Dive explains how state and local law enforcement and consumer regulators can prohibit TRAPs and other stay-or-pay contracts under existing consumer protection laws.

    More

  • Jul 24, 2024

    Deep Dive: State Law Provides an Untapped Route to Combat TRAPs and Other Coercive Contracts

    The following SBPC Deep Dive explains how state antitrust officials can prohibit TRAPs and other stay-or-pay contracts under existing unfair methods of competition laws. Eleven states have laws that provide them with the ability to categorically prohibit non-competes and similar contracts instead of challenging their legality on a case-by-case basis.

    More

  • Jul 17, 2024

    Deep Dive: How Labor Protections Allow Cities and States to Combat Worker Traps

    The work highlighted in this Deep Dive sheds light on the ways that our higher education financing system is detrimental to Black women’s overall well-being and ability to build wealth.

    More

  • Jul 10, 2024

    Deep Dive: How Cities and States Can Unlock Workers Across the Country from TRAPs

    This is the kickoff piece for a deep dive series on how city, county, and state regulators can take on Training Repayment Agreement Provisions, or TRAPs, using existing authorities to protect workers.

    More

In THe News


  • News Clips
    Apr 20, 2023

    They recruited IT staffers with the promise of a prestigious career. But there’s a catch — workers had to stay for two years or pay nearly $24,000

    Read Here


  • News Clips
    Jan 31, 2023

    When This Pilot Quit Her Job, Her Employer Billed Her $20,000

    Fredericks filed her lawsuit with the help of Towards Justice, a legal aid group assisting workers, and the Student Borrower Protection Center, a nonprofit watchdog of the student loan industry. Attorney Mike Pierce, the center’s director, said Ameriflight’s repayment agreement is another illustration of employers trying to foist the cost of workforce training onto workers.

    Read Here


  • News Clips
    Oct 18, 2022

    More U.S. companies charging employees for job training if they quit

    Read Here


  • News Clips
    Aug 5, 2022

    PetSmart offered free training. But it saddled employees with debt.

    Read Here

EXPLORE OUR OTHER WORK

Workplace Debt & Labor Exploitation

Every year, tens of millions of Americans leave their jobs. But for many of them, this can come with a surprise: a bill. That’s because more employers are relying on “stay-or-pay” contracts to trap workers, requiring them to pay a penalty if they leave a job. If left unchecked, stay-or-pay contracts have the potential to leave workers buried in debt just for taking a better opportunity or for having to quit a job to navigate personal hardship.

Learn More
Training Repayment Agreement Provisions (TRAPs)

The most common type of stay-or-pay contract is a Training Repayment Agreement Provision (also known as a TRAP). Employers use these anti-worker contract provisions to trap workers into low-paying jobs with poor working conditions. We work with lawmakers and regulators at the city, county, and state levels to stop worker debt traps and deliver on the promise to ban TRAPs once and for all.

Learn More
Non-competeS

Across the economy, employers use fine print in employment contracts to trap people at work. We’re working to change that.

Learn More
State & Local Projects

We support state and local efforts to ensure we have a safe and well-regulated economy that works for everyone across the country by helping legislatures enact new laws, providing technical assistance as agencies implement and enforce these laws, and training local offices to provide services to their communities.

Learn More

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