What happens if an employee leaves the job before they’ve finished paying for the bike?
Under the terms of the Hire Agreement and the Credit Consumer Act, the agreement to pay your hire is non-cancellable. This means that you will need to settle all outstanding monies before you leave. The outstanding balances will be deducted from your final net salary payment as a termination fee. Settlement will be from net pay because once you leave; you also leave the bike scheme, and are no longer eligible for tax deductions. The hire agreement termination fee will not exceed a value equal to your outstanding monthly salary reductions. This termination fee will be collected by your employer from any remaining net salary payments. For early leavers, who wish to keep the bike package, a fair market value payment (to legally transfer the title of goods) equivalent to the fair market value will also be payable.
