Exit fees campaign / Ep3: Thank you, Severn Trent!

‘GRADUATES SHOULDN’T HAVE TO PAY TO LEAVE A ROLE THEY’RE UNHAPPY IN’ SAYS WATER COMPANY

Our campaign to #StopExitFeesByXmas is working – we have our first supporter!

Last week, we blew open the scandal of the firms that have been charging graduates up to £25,500 if they leave their programme in less than two years. These companies claim that this is to cover their investment in the graduates’ training, but it is hard to see how such large sums can possibly be justified, when compared with the length and quality of the training that participants describe.

We also raised concerns that young people from disadvantaged and under-represented groups are the most vulnerable to the practice of charging ‘exit fees’ – concerns that are shared by the Social Mobility Foundation. It is therefore bizarre to learn that some of the companies listed above regularly win awards for diversity.

While these eight firms are not household names, many of the clients are – and on Thursday we published a list of the brands which apppear to be clients of the firms that charge huge exit fees, including HSBC, Sky, BP, the Department of Work and Pensions and Deliveroo. Working on the assumption that they are not aware of how their suppliers have been operating, we have invited these brands – and others, who have not been connected with them – to distance themselves from this practice, and condemn the idea of charging unreasonable and unaffordable exit fees to graduates who leave their scheme in a shorter time than the employer would have hoped.

And the first to step up is… Severn Trent! Neil Morrison, HR Director at the water company – and an outspoken senior figure in the recruitment world – contacted Graduate Fog to say he’d be delighted to put the firm’s name to our campaign to Stop Exit Fees By Xmas. He told Graduate Fog: 

“Graduate trainees shouldn’t have to pay an exit fee to leave a role they’re unhappy in. That’s why we’re backing this campaign, which aims to help raise awareness of the challenges they face.

“We’re proud of the graduate programmes we offer here at Severn Trent. We retain 77% of our graduates, which is well above the national average. Coupled with strong career progression and consistently high engagement scores, we can be confident that we’re creating a thriving and engaging environment.”

Tanya de Grunwald, founder of Graduate Fog and the Good + Fair Employers Club said:

“I am enormously grateful to Neil and the team at Severn Trent for stepping up as the first big employer to back our campaign to Stop Exit Fees By Xmas. This is what leadership looks like.

“It’s clear that the evidence we published last week has shocked the HR world – particularly the invoice to an FDM graduate for more than £16,000, payable within 14 days [see below].

“Since then, I’ve been contacted by several big brands expressing alarm at what’s been happening, and who are keen to distance themselves from FDM and co, so I expect to able to name more backers for our campaign very soon.

“It is exciting to think that we may be about to see a wave of great companies pushing these horrible firms to change their ways. For the 4,000 graduates trapped by these fees right now, that would be the best Christmas present ever.”

De Grunwald added that good employers’ horror about the companies charging huge exit fees has triggered some soul-searching about some of the own policies regarding the treatment of departing employees (for example, repaying sign-on bonuses or ‘golden hellos’ or investment in an external qualification, where the employee is more senior). While these fees are either much smaller, only applied to more senior employees, or never chased in practice, it seems this is a good time to reconsider whether they are still acceptable, when viewed through a diversity and social mobility lens.

For this reason, de Grunwald has decided to share the report from the recent Good + Fair Employers Club discussion session Is it ever okay to charge (small) exit fees? to help companies with their decision making. If you’d like to know more, please get in touch via LinkedIn or through our contact page.