18 month Bond

[pesst]

Because of the high turnover rate in my company and the high cost to train new employees, my company requires an 18 month bond after training. So if an employee quits, he/she must pay back the ratio of time worked after training to 18 months to salary and training costs.

My question is, Is it legal for the company to cut salary,benefits,perks while in the bond? Basically can they use the fact that it will be very expensive for an employee  to quit, to exploit the employee.

[This message has been edited by pesst (edited 15-04-2003).]

[cg]

The short answer is: Consult a lawyer

What you are signing is an "Employment Contract", and agreeing to the terms contained therein.

Usually, companies will "protect" their interests, first. They are required to do this, under Company Law, for the benfit of shareholders.

So, don't expect the company to do you any favors. Remember, any waiver of terms/condition of employment is entirely at the DISCRETION of the management.

Yes, some things are covered by legislation--but in general, the employee is fighting an unequal battle. Especially in these hard times.

So, if you have questions about your employment contract--consult "your" lawyer. It may be a small price to pay.

[Why]

Why would you agree to post an 18-month bond for the dubious privilege of working for a company that you apparently distrust?

Are you

1) that desperate?
2) that unskilled?
3) that dim?

What is this "training" and what do you perceive as its value? Moreover, is the value entirely dependant on continued employment with the referenced company? Or can you take these newly acquired "skills" to a competitor?

Sounds to me like you're already being taken advantage of. A pay cut is probably the least of your worries...

Good luck

[Imagine]

Perfectly legal and logical.

The company hires you and gives you a salary.
By sending you for an expensive training, the company also wants a guarantee from your side that you will not take this knowledge within a certain time to a possible compettitor.

Understand that the training will increase your personal market value.

[abc]

BS. It's a normal business risk that the company is taking, by trainning you.

Though clauses like that are totally possible, thay are totally avoidable, just bargain hard. And the "training increases market value is a big-big legend", too. I think the normal "retainer" is 3-6 months, never heard of higher in "normal" country. Unless it's a third world country and the training is 100k US given by aid-agency. Are you applying for a job with UASID Cambodia and getting 6m training in US?

Companies pay without promise of return on many, many things, esp. services by people:
It costs money to chase customers, and no money are asked back if customer goes with competition. Costs money to hire a lawer to exlore legal issue and no money are given back if the issue is not utilized later. It costs money to get a financial consultant to do a,b,c and no money back if it's all scrapped later. It costs money to get a computer programmer to design a web-site and no money back if site never makes it to the web...

[fifa]

My ex-company tried that tack when the turnover for a particicular position got really ridiculous, writing a 24 month bond into the employee contract. Premature resignation meant that the employee had to pay back the cost of all trainings, including some job related meetings. Total bullpoo and conveniently forgetting to identify the true cause of the high turnover of course (crappy manager).

Mind you, this was with a major euro-american MNC, though local operating unit..... It wasn't the reason why I left, but I do look back at that kind of stuff with disgust. That's not how one retains staff....

Unfortunately, there is often no way out of it for junior positions. Unless you are *that* good and *that* crucial to the company, they'll just move on to the next candidate in line.

As for whether they will cut back benefits etc in the middle - I would say not likely. For the most part, benefits are company wide policies, so they can't withhold bits of it from you. If you are entitled to a certain level of medical/health insurance based on your job grade, that's it. Make sure that other non-standard benefits are clearly detailed in the contract, such as handphone, housing or travel allowances.

To be frank, I would avoid working with this company because a contract of this nature is symptomatic of the mindset of the senior managers - and senior managers who condone this are missing the real problems and penalising the "innocent". It's one thing to ask for a bond if the company is sponsoring me for a degree programme or professional certification. It's a whole 'nuther ball 'o wax if they are giving me training to do MY JOB.

[cg]

As I said before: Consult a lawyer about the LEGAL ramifications of signing such a contract. There is more to it than meets the eye.

Some of the other posters here are arguing about the ethics of imposing a "bond". That is another issue altogether.

You should take the job with complete awareness of the terms and conditions under which you are being offered the employment. Trying to weasel out of it at a later date may cost you.

As someone here has suggested, you have 3 choices:

1. Walk away from the job (there will always be someone who is more willing to take it, under the same restraints)

2. Take the job (with full knowledge of the onerous conditions imposed)

3. Negotiate with the employer, and get the revised terms in writing. (This tack will work if you are in a strong bargaining position, or have skills that are rare and/or in high demand). Otherwise, you are out of luck.

The crux of the issue is, right now employers are in strong bargaining position--people are in oversupply, and jobs are scarce. Hiring managers are on a roll--if they have budgets.

So, if you are far down on the totem pole then you have to like it, or lump it.

[pesst]

The employer told me that the Singapore gov't requires foriegn workers who get this "training" abroad to sign a bond.  The training is about a year in Europe. This is supposedto be, because the singapore government is paying for half of the costs of the overseas travel, and expenses. The high turnover excuse is just a bonus for the company.

[cg]

If the government is footing one-half of the training cost, then they have every right to ask you to stick around for a reasonable period of time (in this case, 2 years).
Otherwise, the company may be out of dough if you leave (I assume they may have to reimburse the government)

In fact, many of the training/study scholarships that are given by the government and GLCs to Singaporeans also have 2 to 3 year bonds.

So, you may not have much choice--if you want the training.

[abc]

Well, a year in Europe, government job... I don't think you'll get out of the 18 months, no matter of bargains and lawer consultations.

Just make sure you don't pay anything if they fire you, if you get married in Europe, or you/ family member gets sick, and "unavoidable"-s like that... and then there are lots of ways for you to walk away if needed.
I got quite a bit of foreign training in my first job and had symilar clauses, then entered top business school, my boss signed it was "unavoidable" to go there, and I paid zero to govt, without any promises to go back (since buss-school was much more expensive than all trainings, and govt salary close to zero).

[fifa]

Well that's a whole other kettle of fish you're presenting!

I'm afraid that I'll have to side with the requirement then - if this is a training programme then that's part of the quid pro quo.

[pesst]

For me, the bond is not a problem. The only problem is if the employer can legally exploit me. Can they cut my salary to 0 and still say, "you better stay or else". I'm exagerating of course but times are tough for companies, And bonded workers are easy targets.

If things get too bad, I can always close my bank accouts and flee the country  

[fifa]

Since the employment contract states clearly your salary, I would say that if a decision is made to cut your pay, the company has in effect broken the contract and can't hold the bond against you!  

Of course, I don't make up the rules so please don't try to use that if things don't work out .....

[cg]

Can you NOT read?

Put this question to a lawyer. We are talking about legal documents here (employment contracts, bonds, etc).
Only after examining the employment contract can somebody offer you sound advice. What's the point in speculating?

As I said before, employment contracts are often biased in favor of employers ( They have a lot of leeway in deciding the terms and conditions.)
But, the law does not encourage discriminatory treatment, or exploitation of employees.

Since you haven't provided us detailed information--how can someone advise you properly?

Go to a lawyer, with a copy of the bond, your employment contract and your company rules & regulations. Only a lawyer can advice you on YOUR specific circumstances.