Bonds: Certificates of trust.

A bond is an understanding between the employer and the employee for honouring the commitment made by one towards the other. It is for the mutual benefit of both parties and can be justified on more than one ground. There are certain areas of operation in a company, which are core to its existence and they contain competencies which are exclusive to the company. Thus an employee being trained in these competencies holds a strategic position in the company & almost assumes an indispensable role in the organization.

This kind of understanding is similar to a marriage wherein dowry is paid at the time of the marriage and compensation is demanded in the event of a divorce. It is the trust that is broken and the main concern for a compensation to be demanded. Similarly when an organization asks for an amount as a bond it is more of a value of the trust reposed in the candidate and the converse is true for a divorce as in the case of an employee leaving the organization.

Moreover, like in the case of RumDal Steel, there is also a loyalty bonus of 100,000 INR and certain perks for serving the company for more than or equal to 3 years. It is a unique way of defining a bond by giving incentives to employees rather than arm-twisting them to stay. Such incentives apart from the recovering of the training expenses can be a motivating factor for the employees to be loyal to the organization rather than just having clauses of them paying compensation. The only change I think that should be brought about, if possible would be to have different bond values for Graduate trainees & people having experience with the company of more than a couple of years as a person having worked in an organization could know more about the organization as well as would be obviously of more value to the organization rather than a fresher.