Loaning your employer money.

[SuperchargedRS]

I'd do it, but I'd do a 10% loan secured with collateral, unless they are publicly traded. Compounding intrest is a beautiful thing.

If they'd agree to that, I'd loan then far more than that.

[digits_]

I'd do it, but I'd do a 10% loan secured with collateral.

Untill you get fired for not flying overweight, busting minima, refusing to fly unsafe airplanes.

Or, even scarier, you do all those things because you want to keep your job and not lose your money?

If it is a classy company, I guess you could think about the investment opportunity, then again, a classy company would probably not ask for this. If you want to invest, call a classy company, and make them a deal, I am sure most of them would welcome investors.

[trey kule]

DocBrad...
In my opinion, your colleagues are a big part of the problem with the industry.
A company is, or should be, responable for your training costs.
A bond requiring you to a period of time working for them may be fair. But this is not a bond, it is a loan to the company.
Pilots that agree to up front money like this perpetuate it.

we are talking here about the company wanting a pilot to pay them for the training by loaning them money.
Those that think this is perfectly OK, lower the bar on professionalism. And make no mistake, the destination companies learn from it, Spin off companies from the majors with lower wages and more hours and more days per month. Your colleagues have made their position clear....we will work for less than mimimum wage. Will lend you money just to give us that opportunity..

For us old guys at the end of our careers , all we can pretty much do is shake our heads and walk away.
Feeling bad for the competent, hard working young pilots who have to sit on the sidelines because others who are less qualified can come up with cash. you youngins should be incensed as all get out that there are pilots willing to agree to this. It is your future WACON. they are eroding.


Btw. All the big five Canadian banks are paying around 4% dividends right now, which are taxed lower than interest income, and typically , and consistiently have good capital appreciation for a return of far more than 6% p.a. Not sure why anyone would think an unsecured loan to a small aviation company is a better investment.

[photofly]

I'd do it, but I'd do a 10% loan secured with collateral, unless they are publicly traded. Compounding intrest is a beautiful thing.

If they'd agree to that, I'd loan then far more than that.

I totally agree.

But, it does put me in mind of Winston Churchill's comment about "We have already established what you are, Madame. We are merely haggling over the price."

[Rookie50]

I do find these editorials interesting on this subject, from a business owners chair. Here's my take:

1) Those against training bonds, why would a company put up 20K (maybe it's a lot more) in training expenses only to see a pilot jump after 6 months for a better brand of coffee, or some other reason? That's a lot of money and aviation is a skinny business from my impression.

Many other industries I've worked in as an employee, have instead stringent non compete agreements enforced by the courts. Start working here, can't work for a competitor for years. Can't work for the company's clients, nor their clients. Like, anywhere. Now that's nasty, debatably --- but the courts have held those client relationships deserve protection.

2). Rather than rail against the policy, I think a 6% return is quite fair, if you think the company will be there. The choice is always there to walk down the street, but the posturing that all new pilots have their pick of jobs lined up at 100k -- I kinda raise my eyebrows. The expectation levels I find for new particpants in any industry doesn't meet reality, so much of the time. Have to earn ones stripes.

Maybe also, the no bond companies are so bad in other ways they have to lure pilots through no bond. I don't know. Or they are good, but it's impossible to get in except through a name.

I would think, the good companies, bond or no bond, will have pilot applications lined up a mile long, and they couldn't care less what anyone thinks. I doubt there is much "negotiation" with such companies , although I could be wrong --

If the model is a mistake, the free market will sort that out, willingly. That's how it works.

Yes, some business owners are total, abusive jerks, no question. But remember someone at the (successful companies) worked day and night, likely, and risked a ton of personal money to make it happen. They earned the right to set the rules for their business.

That is always a choice for anyone unhappy with the limitations on being an employee. Strike out and start a business. But it's a lot more work, without any quit time in it. (Take it from me)

FWIW if I was a commercial pilot, I'd take the overseas route in a heartbeat, build up both some savings and further experience, then return to Canada.

The uncomfortable, unconventional road will almost always lead to greater long term success.

[SuperchargedRS]

I'd do it, but I'd do a 10% loan secured with collateral.

Untill you get fired for not flying overweight, busting minima, refusing to fly unsafe airplanes.

Or, even scarier, you do all those things because you want to keep your job and not lose your money?

If it is a classy company, I guess you could think about the investment opportunity, then again, a classy company would probably not ask for this. If you want to invest, call a classy company, and make them a deal, I am sure most of them would welcome investors.

That's not how a real loan works. My performance as a PILOT has zero to do with a financial loan I might make.

Like I said, I'd be cool with a loan if the numbers worked in my favor.

[lownslow]

Trey, just curious but where do you stand on training agreements that don't have cash up front?

[photofly]

Maybe there's a business in providing training bonds for pilots.

It could be like bail bonds: skip out and Mad Dog the enforcer will hunt you down and extract your teeth with pliers until you pay up...

[trey kule]

Trey, just curious but where do you stand on training agreements that don't have cash up front?

It is a difficult question for me. I can understand both sides' point of view. But my thoughts aside, I think they are going to be around for awhile.
If they are fair, both in the amount, and in the term, there should not be any real issues. But fair can be a rather subjective term.

For some issues I simply don't know if there is a good answer.

[AirMail]

Has the pilot shortage hit yet? I thought these scum operators were in fear of attracting pilots... anyone dumb enough to sign/pay for a bond deserves a bad outcome for their financial lunacy. In the US, operators are paying signing bonuses. Not the other way around like the ill mentality that has a firm grip

[Docbrad]

So is there such thing as a bond with no money up front?

How about those "training agreements" Where its says $10k for 2 years, but advertise as no money up front. No money changes hands, but if you leave early they will come after you. Is this type of thing more acceptable? Is it still a "bond"?

[Ypilot]

So is there such thing as a bond with no money up front?

How about those "training agreements" Where its says $10k for 2 years, but advertise as no money up front. No money changes hands, but if you leave early they will come after you. Is this type of thing more acceptable? Is it still a "bond"?

Let's say you get fired for refusing to fly into fzdr or because you are overweight, if you paid an upfront cash training bond, you can say bubye to your $$$$$. On the other hand, if you are let go not because you are a clown but because you refused to take off into what you thought was unsafe, or because the company you work for is in financial difficulties, if you are tied by a paper contract you will be losing your job, not your job and your money.

I think the training bond is a fair system except for the upfront cash, also kiddos with 65000$ of debts don't have leverage at the bank for a 3-5% interest rate, even with a good credit.

[Docbrad]

So is there such thing as a bond with no money up front?

How about those "training agreements" Where its says $10k for 2 years, but advertise as no money up front. No money changes hands, but if you leave early they will come after you. Is this type of thing more acceptable? Is it still a "bond"?

Let's say you get fired for refusing to fly into fzdr or because you are overweight, if you paid an upfront cash training bond, you can say bubye to your $$$$$. On the other hand, if you are let go not because you are a clown but because you refused to take off into what you thought was unsafe, or because the company you work for is in financial difficulties, if you are tied by a paper contract you will be losing your job, not your job and your money.

I think the training bond is a fair system except for the upfront cash, also kiddos with 65000$ of debts don't have leverage at the bank for a 3-5% interest rate, even with a good credit.

Thanks! That cleared up a lot. One of my main concerns was what if the company went under. I also now see why so many of you also see it as unsafe. A Go/NoGo decision now has a $10k-$15k risk associated with not going.

[Saxub]

I'd sooner spend 15k on a A320/737 rating and go apply overseas than pay a similar bond to a 704 operator in Canada.