Madhu.T.K
Industrial Relations And Labour Laws
Cite Contribution
Community Manager
B K BHATIA
Director Of Company
Loginmiracle
Consultant & G.m.
K C S Kutty
Labour Laws
+2 Others

\"Its is informed & agreed that XYZ Solutions provides training worths Rs50,000.00 (Rupees Fifty thousand only).\"
plz note:
> We are software dev firm.
> we are framing agreement for 1 contract with engineer.
> If the person leaves job before 1 year we want him liable to pay Rs 50K . Our senior engineer spends time with them helping them understand advanced topics.We want this to bring under training.
plz suggest how should we frame the clauses. As i read here that companies need to prove that training was given.

11th April 2013 From India, Kolkata
Certainly a clause to refund the training cost incurred by the establishment in respect of an employee shall be incorporated in the contract of employment. However, it will be your (company's) duty to prove that the company has spent the amount equal to the sum demanded exclusively for the employee.
Regards,
Madhu.T.K
11th April 2013 From India, Kannur
If you are paying the training fees to an outside for providing training to your employees, that cost of training along with incidental charges spent for training purpose can be recovered, if the employee leaves the organisation within a stipulated period, say one year. This should be a clause in the employment contract.
If the employee has already joined based on the contract of employment, the said clause can be incorporated in the order /advice of deputing him for the training and acknowledgement must be obtained from him.
If a senior person guides the employee for executing the task or performing the work, it cannot be said to be training and that cost (what is that cost, salary of the senior ? ) cannot be recovered, unless otherwise it is done in a formal way keeping the employee away from the work place.
11th April 2013 From India, Madras
Salary of senior engineer is 30K pm. He spends almost 50% of time guiding and telling them the finer details, advanced concepts ; clearing their doubts, mistakes, bugs etc.
He guides them throughout the year. And there are 4-5 juniors under him.
thanks
palak
12th April 2013 From India, Kolkata
The issue being raised is very genuine since small size software companies put in effort, energy, time & money to train the freshers for their own business. Such companies are not training establishments to develop people for use by big companies. But the big fish lure these employees with higher remuneration to join them even without a relieving letter from the previous company. While big companies may not accept it as an unethical practice, organizations like NASCOM may like to look at this issue if they are interested in the growth small businesses & entrepreneurship.

Comments & further discussion on this issue can at least help in creating a consensus amongst the small software companies on how to legally protect their own interest. I personally find no harm in stipulating the refund of training & infrastructure cost by an employee, who leaves the company without completing one year service after finishing the training (which includes on the job training), as a Terms & Conditions of employment. If a fresher is not keen to join as a trainee on these terms & conditions, he/ she need not sign the employment agreement.

If every small software company adheres to a common yardstick of 'one year training + one year post training service' or refund of full cost of training for premature separation from the company (except termination of services by the management), there can be a common ground to set up & streamline the employment process.
12th April 2013 From India, Delhi
A lot of companies have started asking to submit marksheet /degree for 1 year. That is not a legal solution and some good candidates avoid it. What steps are taken by you.
12th April 2013 From India, Kolkata
Don't you think you are going reverse way here??

The reasoning sequence should be:

1. Company spends money/efforts on training. They "know" the cost of training & can justify (say 50K).

2. They don't want the employee to leave the job, unless the training cost is recovered by the gains from services provided by employee. They know the ratio of gains against cost to define the term.

3. This term (say 1 year) is agreed between company & employee.

While here is your reasoning sequence:

1. Company does not want the employee to leave the job sooner. (You are not sure if you can provide environment, where he would want to stay at least a year).

2. A clause is put in agreement with an inflated amount, based on the salary offered; so employee cannot afford to leave.

3. Actually company does not pay much on the training itself. Generally there is internal training of 1 or 2 weeks. Then the employee trains on job. The senior engineer is generally a team lead, whose responsibilities include services from his juniors & he does not book seperate time on "training" throughout the year.

4. Then company is now searching for the reasons on how to justify the amount, so if they have to go legal in future, they are covered. For this, help of such forums is taken.

Is this the real purpose of this forum?

& is HR department also not responsible for ethics?

How does it fit into ethics, to find the reasoning on internet, for the expenses that are not actually directly done by company.

Any way, there are some things that you can do:

1. Estimate the initial 'formal' training cost.

2. Some companies call this period as 'probation' period, so the quality requirements need to incorporate the 'training curve' for employees for this on-job training period into your quality system (say performance index or earned value). Give clear picture to employee about his training curve.

3. Ask the senior engineers to record the efforts for training into the quality management documents.

4. If still the 'budget' of 50K is not fulfilled, then do provide some additional trainings to the employee, so you would actually have a 'better trained' employee. Remember, the basic need of training is for betterment of employee assets; & not to justify the clause in contract.

Hope I was helpful, & pardon me for any strong words up there!

Amod.
13th April 2013
Dear friend,

As you know there has been umpteen no.of litigations pending in various courts over the bond during training. It's very difficult to draft a foolproof agreement of bond which cannot be challenged in Indian courts. However certain aspects has to be looked into very closely.

First of all proving beyond doubt, how much and in what manner the employer incurred certain costs on training the employee. Though it is no doubt could be arbitrary complete documentation would be helpful which should be verifiable.

Secondly, many companies follow a "Management Trainee", "Engineer Trainee" or some such designation for the initial apptt. with a provision to confirmation subject to availability of posts etc. This system goes to aid the employer to show case that the entire period the employee has been under training and whatever CTC during the period is the 'cost of training'.

Thirdly, as the adage goes - ..."not only the justice is done but also it should be seen to have been done" which means there should be visible evidence that the employee in fact is under training. This could be ensured by more than one methods. Like - Prepare & circulate a detailed training manual and conduct the every day affairs accordingly. And earmark certain hours of the duty hours as "training hours" which should be documented well.

Fourthly, there should be exclusive Trainer Officer whose time should be substantially spent with the "Trainee"

Fifthly, A periodical progress report should be prepared about the Trainees' progress together with progressive amount spent (CTC) on each such person and issued to the trainee under acknowledgement.

Like this we can think of some more conditions to strengthen the object. Needless to say, The success of this exercise would depend much on avoiding unfair labour practices.

kumar.s.
13th April 2013 From India, Bangalore
I understand the HR side to this discussion. I have managed where this was implemented at a very large scale, even worked on the recovery when there was a non-adherence.
However, is this legal ? How far can these training or travel agreements be challenged in the court of law?
Regards,
(Cite Contribution)

13th April 2013 From India, Mumbai
Dear (Cite Contribution),
Thanks for your comments on my suggestions.
To make things legally viable, senior people from NASCOM or from big IT companies should come forward and address the problem of "How to make the small size software companies survive the menace of big fish not allowing them to grow by snatching away their trained workforce?" It is no purpose shying away from this important responsibility.
Let us wait for some comments from them & then address the legal issues (if any).
Regards
15th April 2013 From India, Delhi
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