Correct me if I'm wrong but there is no employment obligation for 18 months. You go through the same interview process and you can get fired just like any other employee. This is no different than hiring any other employee.
> Long terms lead to more conservative hiring, leading to less placements overall.
I would argue that less higher-quality placement is a Good Thing.
> From the student side, ...
As a student, your goal is to start building your value and getting proportionally compensated as quickly as possible. Since most value as an engineer is gained well after the first few months of ramp-up you experience at every new job, you end up getting very minimal value out of a bunch of 4 month terms. Not to mention you won't be getting paid nearly as well as someone who is not labelled as a "student".
18 months is marginally better because you're actually growing your skillset, integrate as an important and dependable part of the team, and gain valuable engineering experience. On the other hand, you're still under-compensated and it's trickier to switch jobs half way through if you realize that you've made a mistake.
Finally, my argument is that the most optimal path is skip coop/PEY and find a relevant job right out of school. Even if it's not the best job in the world. You'll be far better off sticking around for 12-18 months, quitting, and getting a second real job, than to do 18 months of PEY and getting your first real job. Both in terms of real valuable experience and compensation.
When big companies look at your "industry experience", the counter doesn't start until you're no longer a student. I've been building and selling software since I was 14, but none of that went into account with HR of big companies when they were deriving the offer for my salary or position. Negotiation and positioning, on the other hand, did make a big difference. But that's another story.
The best value for coop/PEY/internships is to students who lack confidence or experience in finding a job right out of school, or they simply have no idea what they want to do when they grow up or want to drag out their student status for as long as they can. These are all very valid reasons.
"For fresh grad though, if they quit earlier than 18 months, they have to pay almost a year of their salary, which seems reasonable when there are trainings when they joined the company."
No, that is not ever reasonable anywhere in any situation. May be typical, but not reasonable.
In the US, that does not happen. The expectation is someone only gets terminated in the first year if they are terrible. Unless it’s a tiny startup, such a stint would raise concerns.
I am loathe to take advice from Andy Grove, only because I feel that employment rules of engagement have changed drastically when he was a manager.
In the last 5 years, I've seen the minimum time in Silicon Valley to stay at a job drop precipitously from 2 years (the norm that I'm used to going back 20 years) down to 1 year. I see a lot of jumping around, especially at the more junior end of the spectrum, where total comp can jump by 30-50k in the first 3-5 years of experience.
And young people know this, because everyone shares their salaries and total comp openly. This is a big change from my generation. So they're aggressively leaving after the first year, moving a couple of times and earning a lot more than they would have if they simply stayed at their job for 2-4 years.
One thing young people want is to be mentored aggressively, and for them to get their careers on track immediately. I try to cater to this by meeting with them once a week, to show them that I actually do care about their career path, and also selfishly, in hopes that they don't want to leave within a year and I'm left trying to fill another headcount. If I left the 1:1 to once a month, then I would only see them less than half a dozen times before they've decided they're going to leave.
But if they know that I'm working with them to further their experience, that they're not stuck in a rut and if they stay with me, that they can trust me and they won't get screwed doing all the boring grunt work, then I have a hope they will stay 2+ years with me before they leave.
So? Even if they leave right after the sabbatical, you've successfully retained them for five years. That's an eternity in tech and definitely worth the expense.
And on the flip side, compensation plans that encourage people to stay to arbitrary dates are probably a mistake.
That's where I'm at today. There's a lot of money resting on my staying at a company for a year. I don't feel like I've been working effectively with the culture or team, and I'm pretty sure both me and the employer would be better served by my leaving, except the financial incentive, sunk cost, and avoiding having a "I worked here for only 6 months" on my resume is enough to justify me staying an extra 6 month.
Potentially not coincidentally "percent of engineers who stay a year" is one of the key metrics of the team that sets up the compensation structure...
Despite some painful implications of his argument, one aspect of his solution is ok: more options with a longer vesting period. This helps keep the best people around for longer, as they continue to accrue benefits of the career and comp risk they took by joining an early stage company. There would be a lot less incentive for people to leave at 4 years. (In most companies, the equity per employee handed out later on is tiny compared to what you can give early employees)
What a silly policy. Who but the most short-sighted possible person would quit after only two weeks on a job? That's not enough time to know if it'll work out and $5,000 is less than the monthly take-home pay for many software engineers.
Wait until six months in, and offer three months' salary. Then you'll see who wants to stay and who doesn't.
It seems like this can easily be fixed by having people sign up for contracts that last more than 1 year or at least have some financial incentives that accrue to employees who stay longer? For example, tech companies have stocks that only vest after 4 years. I don't see why in principle this couldn't be even longer.
I don't know much about it personally, but I think the US government has a lot of benefits (like retirement) that scales with years of service.
I actually suspect that at least for many big companies the problem isn't getting people to stay after training, it's getting the best employees to stay and getting lower-performing employees to leave. I think for this reason, most tech companies structure pay with a 4-year contract, which promises a high salary for 4-years (due to bonuses and stock), and then an implicit pay drop if there's no promotion after 4-years.
Ah yes, the companies with bimodal tenure distribution; it's either 3 months or 13 years, and nobody with 3 years. You either accept the bullshit and stick around, or you get out of there fast.
I work for startup, finishing third year. I joined in quite early stage. Every year I received a package of options that vest 25% every year for 4 years. So the company still expects me to stay for next 4 years. Is 3 years long term employment? For me yes, I used to switch every ~4-5 years, and my current company does a lot to make us stay for longer.
You don't just get asked to resign, you get made an adviser for awhile and still paid! Tony will be an adviser for a set period of time and still collect a bunch of money, which will help him save face and probably prevent him from working for other tech companies for a specific period of time. My guess is that he will be an adviser for 1-2 years.
The closest I've seen is a minimum term for sign-on bonus, school reimbursement, or moving bonus. Work less than X months and you owe the company back either. But just minimum employment term for start-up training? Training new employees is just part of the cost of doing business and the risk of them jumping is just part of doing business.
I'm sure there are US companies that try it, though.
How would that work? Very few people stay in a tech job for 10 years. I stayed in a software job for 9 years, until I was laid off, and that's extremely unusual.
- If you leave/fired < 4 months no responsibility.
- If you stay after 4 months you agree to ISA agreement.
- Agreement is that if you leave within 4 years you agree to share 20% of income up until you have paid $60k.
- ISA is valid for 4 years. Then it's VOID.
- ISA is also valid if you get a tech job.
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