What is an employment bond?


Quick Answer

An employment bond is an agreement that one comes to with an employer prior to becoming a member of staff. Such agreements tend to stipulate the conduct that the employee is expected to uphold as a member of the company. Since this is a legal document, having the employee breach it often leads to fines stipulated in the bond.

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What is an employment bond?
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Full Answer

There are a number of reasons why a company may make new employees sign a bond, the most common of which is to reduce staff turnover. When a company notices that a large number of employees keep leaving, it may bond the new ones for a set amount of time, such as one year. This means that if an employee decides to quit before this amount of time elapses, he may end up having to pay damages to the company. The consequences of violating the bond must be clearly stated in the agreement.

In many parts of the world, the scope of the employment bond may be limited by national laws. For instance, there are some countries where compelling potential employees to sign a bond is not allowed, and doing so may lead to the imposition of fines from the civil courts.

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