Bonds - Not always fair

Due to the surge of knowledge intensive industries in the past decade we are witnessing a slow and steady metamorphosis of bonds. Bonds have been there for some time which states that the employee needs to serve the employer for a certain period of time. If the employee fails to respect the bond, he/she needs to pay the amount specified in the bond to the employer. Knowledge intensive industry works around a model which requires them to invest on their employees initially by means of training and reap benefits after the employee spends certain amount of time with the organisation. Keeping this in mind the rationale behind a bond sounds quite logical.

The questions which arise now are:-
1. How do the companies arrive at a certain figure as pointed out by Santosh?
2. Whether the duration of the bond mentioned is actually justified?
3. Are the companies trying to hold on talent for some more time in the name of bond?

I totally understand the companies do spend a considerable amount of money for training, but what puzzles me is the difference in the amount mentioned in the bond across various companies under the same industry. For example – A company X in IT industry puts Rs 3,00,000 as the bond amount for training its employees whereas there is another company Y in the same industry providing similar kind of training ,which specifies Rs 75,0000 as the bond amount. I think it is unjustified to have such huge differences in bond amounts for companies working in a similar industry and providing similar kind of training.

Also, the duration of bond sometimes becomes a grey area. Some organizations have a bond period of 3 to 5 years which is very absurd. A period of 3 to 5 years is too long a time to justify an employer’s investment on a particular employee. The revenue earned by an employer on a billable employee in IT industry for a year is sufficient to cover up the training costs. In such a scenario, why does the company have a very long bond period?
I personally feel that in this fast growing knowledge industry, companies sometimes try to hold on talent by having long bond periods. In case the employee moves out the company at least is able to recover the bond amount.

In India, the companies get into an agreement with the employee but do not always force the employees to pay the amount upfront. In such cases the employee spends some time in the company and later absconds, following which the company has to spend considerable amount of time and energy to recover the bond amount. Most of the cases the company does not push much as pointed by Sumit. In order to tackle such a problem some companies ask to deposit the bond amount before joining the organization. This happened to me when I joined Wipro Technologies 3years back. They also offered loans to people who could not pay the amount at one go. So, we can see that the organizations come up with ways which ensure that they are not affected by such incidents. Therefore, I feel that employers have the right logic for implementing bonds but their intentions are not always very honest.