Breaking Contract Bond: Is it Worth it? 2


In my article last week, I talked about whether there was an intrinsic cost to education. Long story short, I think there is. I mentioned briefly that I had a contract bond to work for the Government similar to many other scholars. If I’m being honest, I have encountered many graduates who have contemplated breaking their bonds at some point. It is a ball-and-chain system which keeps us rooted here; wasting our time if not utilised in our primes.

There was a point in time where I Googled this topic; only to be met with little to no results. I even resorted to asking this question on multiple sites such as Quora and Yahoo Answers. The answers I got were brief and not very helpful; I’m talking about one-liners. Answers include “If you can pay back, sure.” and variations of it.

The reason I looked into this so deeply was because I felt that I was at my wit’s end. Stress and pressure of work was really getting to me and I wanted out as quickly as possible. The downside of trying to get out is I have to pay back all the amount spent because I signed a bond. Not that this contract was optional, by the way.

What is a contractual bond?

A contract bond is a condition within a contract or agreement between 2 parties; usually an organisation and an individual. These conditions are usually written in a way or another stating:

  • The organisation agrees to sponsor a study or training course, and,
  • The individual agrees to “bond” and repay to the organisation in service for a period of time.

Basically, you sell your soul for a (hopefully short) time period in exchange for the opportunity to further develop yourself. You can think of it as an insurance for organisations in the event someone they paid to develop decides to run off. Therefore if both parties honour the agreement, it’s practically a win-win. But what happens if there’s a breach of contract?

In my case, there was an education bond of 5 years and a training bond of 3. Breaking either would have definitely taken a significant financial toll in terms of repayment.

Should you break your contract bond?

In short, if you dropped in through Google the answer might infuriate you. The answer to “should I break my bond?” is a definite… Maybe.

Before you grab your pitchforks and torches, please bear with me for a bit. When I was looking for answers all those donkey years ago, I too wanted a definite answer. Not only were the results not definite, they weren’t the least bit helpful in my so-called plight! Anyone can tell you that “everybody’s different” and so their needs and views are different. In hindsight, I wasn’t annoyed I didn’t get the answer I’m looking for. I was frustrated at the lack of information out there to base an action on.

Was I the only one who was thinking about this? The only one who was not going to fulfill my promises? Apparently not because over time, I found just as many others who were at a loss. The situation was: we were to serve a bond but there wasn’t enough job posts for us to fill! We were in a limbo where we want to get the bond over with but are not able to. Not only that, we were barred from seeking employment elsewhere! Who writes these terms anyway!? But as youthful fallacy would have it, we signed the contract and there were consequences.

While breaking our bonds may sound simple enough (grass is greener on the other side, after all), I have learned that there are some things to consider. Had I known this in the past, I would have been better informed and not reduced to “sucking thumb” and waiting for time to pass.

Things to consider before breaking a contract bond

1. Money

At the end of the day, it’s all about the cold, hard cash. If you have the means to pay back the bond, that’s fine. But just because you can doesn’t mean you should. Before coughing up the dough, run a quick calculation to see how long you would be able to sustain yourself on your current savings. This is especially important if you’re unemployed as there’s no cashflow to sustain yourself in the long term.

2. Employment

A harsh reality we find out when we came back from studies is this: Your bond does not mean you’ll get a job. I found this the hard way, holding on to my bond for too long (will cover this in the next point). To be frank, none of us understood why scholarships were given out like candy when there’s no jobs on the graduates’ return.

But before breaking your bond, it is best practice to secure some form of job first. This way, you at least have some cushion financially.

3. Timeframe

Don’t wait too long before taking action. One of the bad advice I got when I graduated was “Don’t rush to get to work. This is the only time you can enjoy and be free.” bzzt. Wrong! Time is of the essence because you only start paying back your bond when you start working. The longer you prolong it, the more time you rob out of your future self.

I waited nearly 2 years before applying for a release; something I should have done after a year or less.

4. Future Prospects

On a more positive note, if you see your bond through, future employers will see that you honour agreements. This gives an impression that you’ll be less of a flight risk and potentially increases employability. Putting yourself in an employer’s shoes, would you hire someone who stuck through 5 years and not give up? Or someone willing to breach contract to escape?

While this is subjective, people are fickle creatures and are likely to form biases. Unless you can spin breaking a contract bond into a positive light, the odds are against you there.

5. Emotions

I have to admit: majority of the time when I was thinking of breaking bond was when negative emotions were high. The thoughts that relate where you are to a steaming load of crap pretty quickly consumes you. I don’t know how I got out of the rut other than at one point I stopped thinking about it.

That being said, take time to analyse your situation and don’t break your bond based on emotions. Emotions cause people to lose money in investments and just as easily cause losses in this respect.

Having hobbies and plenty of time with loved ones definitely helps! Just don’t drag them through your emo times for long; it’s not healthy for them either. If you feel you need someone who you can open up to, the Ministry of Health runs a Community Psychology Service. Things discussed are kept confidential and staff are professional.

Address:
B30, Level 1, Anggerek Desa Flats
Bandar Seri Begawan, Brunei

Bond release: The Silent Hero

Here’s an alternative to outright breaking a scholarship bond. Note: It does not apply to occupational bonds.

There was word of mouth going around that we could get our bonds released but there was no solid information on that. I have tried and succeeded to obtain this “release” and am no longer bonded with the government. However, inside the release stipulates that I still need to serve the country for 5 years regardless of sector. Fortunately, in February 2016, our now-defunct Brunei Times published an article about this issue:

Contract bond article by the Brunei Times

The Head of Scholarship Section highlighted that there is a release bond. This release is more of a transfer of your contract to a private company. You may apply for it under these conditions:

  1. Tried (and failed) to secure jobs with the Government.
  2. Not bonded to work in a specialised field e.g. doctors and teachers.
  3. Job offer from the private sector.

This route is an excellent method to break out of the “no job with Government = stuck” conundrum. It opens the door of opportunities for work in private sectors and this is a breath of fresh air!

Once again, bear in mind this only applies to scholarship bonds in Brunei. Usually contracts with companies are more strictly enforced and there are no takesies-backsies.

Conclusion

Honouring an agreement is a gentleman’s pledge; or a lady’s pledge for that matter. Just because you can pay back in cash doesn’t mean there are no other repercussions. It might cost you a referral or a negative review in the future. It would be best to serve the bond in any way possible especially considering the release-bond option and move on after that.

If you are considering breaking a bond, you have to carefully gauge your situation. After sleeping on it for a while and you still want to do it, do it in the as soon as practicable; I wouldn’t do it half way through and especially near the end. You would still be liable to pay settlements for breaching contract regardless of how long you’ve served.

But only consider breaking contract bonds if it was your LAST option.

For someone like me who’s come to the point where I can see the light at the end of the tunnel, breaking my bond is meaningless. I would be so bold as to say all the hardship made me all the better person; more persistent and resilient; not to mention smarter with contracts.

Regardless of your choice, the most important thing apart from it being right for you is you commit fully to it. No half-assed regrets down the road; which usually come from uninformed decisions.

The quality of a person’s life is in direct proportion to their commitment to excellence, regardless of their chosen field of endeavor.

– Vince Lombardi

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About Fox

Founder of The Savey Fox. I am interested in how money works and makes the world go round. Borne from picking up a personal finance book when I was unemployed after University, I strive to continually learn and share about finance. Other than the big $ signs, I am an avid gamer, coffee lover and seasonal gym rat.


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2 thoughts on “Breaking Contract Bond: Is it Worth it?

  • Bobby Saint

    I appreciate you proving some things to consider if you’re planning to break a contract bond such as money and employment. I couldn’t agree more when you said that you should calculate your savings and finances to ensure that you would be able to sustain yourself while unemployed. This is why it is best to make sure that you have already signed an agreement with another organization before leaving your current employer. This way, you wouldn’t have to worry about any employment gaps. If I ever get a contractual bond from a company, I would definitely take this into account. Thanks.

    • Fox Post author

      Hey Bobby!

      Thanks for the comment. Yes strongly believe that the best is to have an alternative job lined up before jumping ship. However, in worst case scenarios, we might not be so lucky to have another job waiting to break our fall.