* SKY SPOKESPERSON: ‘WE THOUGHT FEES WERE SCRAPPED ON 1 APRIL’
* EX-FDM GRADUATE: ‘FDM CHIEF COMMERCIAL OFFICER PHONED TO SAY I’M OFF THE HOOK FOR NEARLY £8,000 IN FEES’
* CURRENT FDM GRADUATES: ‘WE’VE HEARD NOTHING ABOUT EXIT FEES BEING SCRAPPED’
What is going on at FDM Group? The latest news to come from the troubled tech giant suggests the company is in chaos as it scrambles to contain the fall-out from a bruising Sunday Times report last weekend and is sending mixed messages to clients and graduates who have been dragged into Britain’s growing graduate ‘exit fees’ scandal.
What do FDM’s clients say?
Okay, it’s only one client – but it’s a pretty significant development. A spokesperson for Sky – one of FDM’s many well-known clients – has told Graduate Fog that they understood that FDM had scrapped its policy of charging graduates up to £15,000 if they quit in less than two years. On 16 May 2022, the spokesperson wrote to Graduate Fog’s founder, Tanya de Grunwald:
That was news to us – so we asked to see communications from FDM about it. The spokesperson replied:
In previous emails between Graduate Fog and Sky earlier this year, the company insisted that FDM graduates placed at Sky do not have to pay exit fees if they leave in less than two years, a policy that has been in place for some time. The details of any such exemption mechanism* remain unclear.
* Is this even a thing? While it is possible that such exemptions exist, it is unclear how such a mechanism would work in practice. Are Sky’s graduates offered amended contracts for the time they are placed there? Graduate Fog has never seen one, or met any FDM graduates who say they worked under an exemption like the one described.
What do FDM’s current graduates say?
So FDM’s current graduates (known as FDMers) have been released?
No, not exactly – or at least, if they are free to go, they haven’t been told that. Sky’s belief that there has been a change in policy around FDM’s use of exit fees seems not to match with the understanding of current FDMers, who have told Graduate Fog that no such change in policy has been shared with them. As a result, many are still working at FDM under the belief that they will owe as much as £15,000 in exit fees if they quit in less than two years.
Clearly this communication issue is key. Are you really free to go, if you don’t think you’re free to go?
Why are ex-FDMers getting weird phone calls?
Meanwhile, a third group has been told something different again. At least two ex-FDMers who left the firm recently received a phone call from the firm’s Chief Commercial Officer last week, who confirmed that the fees they thought they owed would not be chased.
For one such graduate, Giulia, 22, this relates to a fee of nearly £8,000, which FDM told her (verbally) that she owed when she resigned. She says no explanation was offered during last week’s phone call, but no change in policy was mentioned. The CCO happily confirmed the contents of this phone call in an email the next day, seen here:
Giulia told Graduate Fog:
“The whole thing was so odd. Out of the blue, this super-senior person rings to tell me personally that FDM want to offer me ‘closure’ (his word) – and to clarify that I will not be pursued for the £8,000 they told me I owed at one point. Then he asked me to join their alumni network, and afterwards he invited me to connect on LinkedIn. It was the weirdest thing. I’m glad he confirmed it later via email, when I asked. Otherwise, I might have thought I’d dreamed it.
“It’s a relief to have it in writing, but I’d already decided I wasn’t going to pay the fees anyway. Like many other FDMers, Graduate Fog’s Stop Exit Fees Now campaign has helped me to realise that FDM is just a bully.
“I know at least 10 graduates who are just about to quit – they feel FDM has already lost the power it once had to convince them they are locked in. It seems hard to believe they’ll chase graduates for the fees now that they know that so many of us are talking to journalists about what has been going on.”
What has FDM said?
Graduate Fog contacted FDM for comment yesterday, but – as usual – the firm’s PR agency failed to respond.
What does this mean – and what happens next?
Tanya de Grunwald, Graduate Fog’s founder, said today:
“In the absence of a statement from FDM, we are left to draw our own conclusions about what is happening within the firm. All the signs point to a company in chaos, desperately trying to hang on to clients and graduates by allowing them to think different things. Somehow, despite months of notice and vast resources – FDM still appears to have been completely caught out by the tide of public opinion against them.
“Numerous questions remain. Have other clients, like Sky, been allowed to think that exit fees have been scrapped, and all FDMers are free to go? Have exit fees been removed from FDM’s new contracts, dated from 1 April? Or, if exit fees have been scrapped for everyone, why haven’t current FDMers been told this? And why are senior executives phoning ex-FDMers to tell them they’ve been let off the fees, with no explanation?”
De Grunwald, who is also the founder of the Good + Fair Employers Club, stressed that FDM’s clients should not be satisfied by assurances that FDM graduates will no longer be chased for their exit fees if they leave – because they will still think they are trapped, even if they aren’t. She said:
“If exit fees have been scrapped, it is vital that this is communicated to all the graduates affected. It is not enough to tell clients: ‘We’ve decided not to chase graduates for the fees anymore’ if they are not sharing that information with the graduates. When deciding whether to stay at FDM or not, they need all the relevant information – and this is very relevant!
“Exit fees are a retention tool that rely on fear. The fees were never about making money for FDM. They worked by making graduates feel that they were trapped in a job they could not escape without a serious financial penalty. In my opinion, whenever the fees were chased, I believe that was done to make an example of those graduates – so that word got back to those still at FDM that the threats were real, putting them off the idea of risking it themselves.
“I think it’s interesting that FDM’s graduates have been kept in the dark. My theory? FDM is terrified of the consequences of announcing that their graduates are free to leave. I very much doubt they are ready to handle a mass walk-out, with graduates quitting, abandoning client projects with only one month’s notice. That will be FDM’s worst nightmare. So, right now, they’re trying to reassure their clients that they are taking action to clean up their image, while trying to limit the risk of a mass exodus by their graduates. It’s not a great plan, though, as the two groups were always likely to find a way to compare notes.
“Regarding the statement from Sky, I’ll leave it to them to get to the bottom of the mismatch between what they’ve been told by their contacts at FDM, and what FDM’s graduates have been told. But if I were Sky – or any of FDM’s high-profile clients – I’d be concerned about what this mess suggests about what is really going on at FDM. I’d be asking questions about what sort of company this is, and whether FDM is a supplier that they should continue to work with. Is this the behaviour of a firm they can trust?
“This feels like the tipping point for the campaign to Stop Exit Fees Now. I expect to see dozens clients dropping FDM like a hot potato, from now on. After all, why risk your own brand, to save a grubby supplier?”
* WE’RE SEEKING INSIDERS!
Have you worked at FDM, Kubrick or any of the other firms that charge large graduate exit fees? We’re especially keen to hear from insiders who have worked on the client / sales side of these businesses. How much do clients know about what has been happening over the last few years and why was diversity always part of the ‘sell’? If these firms’ policies never sat well with you, please contact us in confidence here