Breaking the bond

Among the first things that come to the mind of a final year graduate student on getting an offer letter from a company the most important, apart from the pay package, is the employment bond- the bond amount and the duration. Fresh from graduation he considers the company as a stepping stone for future, looking for a work experience before he goes for higher studies or joins another company with better prospects. He decides to pay the bond amount and leave the company if he gets admission offer from his choice of university or a better job within the bond period.

With many companies’ employment bond asking them to pay an amount that goes on reducing as their stay in the company increases the employees even time their exit from the company.

However, the problem arises when it comes to actually leaving the company. The same student becomes reluctant to pay the bond amount which he had initially agreed to. In many cases what happens is the employee is very close of completing the bond period when the academic calendar of the institute he plans to join starts. Now, the employee at this stage tries to convince his employers to relieve him waiving off the bond amount. He may get away with this act if it is a small company or the HR department is lenient in this regard. Sometimes, the bond amount can be negotiated and the employee pays much less than the bond amount. But this doesn’t help in many big companies, especially the IT giants in India who lose thousands of employees every year who opt for MBA degrees. In this case he, either, waits for the bond period to get over (if it is just a few weeks more) and takes a leave without pay for the remaining period of bond after joining the institute, or has to pay the bond and get the relieve letter. In no case, though, the employer waives off the bond amount if the employee plans to quit the job and join another company.

The other option that many employees are now following is simply quitting the job after collecting the month’s salary on first or second day of the month. Some even do not resign fearing legal actions against them. Some let the employers know only through emails. The companies, on the other hand, do not take steps for legal actions against the ex-employees on non-payment of bonds as this would lead to again added cost to the company for carrying on the legal process. These employees are now recorded as “absconding” by the company. This is what encourages the employees not to pay the bond and move out of the company freely. And some companies who communicate with the ex-employee (absconding) ask them for an amount as high as 1-2 lakhs to send them the termination letter. The employees in this case do not get back to the company just for the termination letter.

Without the experience certificate or relieve letter these employees rely on the pay slips as their only evidence of work experience. While start-ups generally don’t look for these documents and hire people based on talent and skills, most big companies do not hire people without proper termination documents with the previous employer. Many of these companies go for a background check and these issues will surely come up then in the future troubling the employees. Also, the pay slips may not be enough in many places leading to more worries. The ones who go for higher studies may opt for a career change and start as a fresher in their new domain where the past does not come to haunt them, but then also they may not be secure. And then, even if they get a job after leaving a company without paying the employment bond, when in future they look for a new job or a promotion and their background is checked there are chances of this act of non-payment of bond amount going against him. If they get away with a proper reasoning behind not paying the bond and leaving a company without the relieve letter and other work-experience documents it will be well and good for them, else this action may go on to haunt them for a long time in the future.

For the employers also this trend of some employees leaving the company without paying the bond amount is alarming. What happens is that they go on to encourage others citing their example of how they escaped from paying the bond amount and many more may follow soon. This not only affects the employer when a large number of employees do so but also the spirit of the employees who respect the bond and pay the amount as they see their friends violating the bond and still enjoying a rewarding career. Thus the employment bond needs to take care of these aspects in future serving the interests of both parties - employers and employees - equally and make the exit of the employees smoother.