A foreign nurse's recruitment fee belongs on the hospital's books

My position is that a hospital recruiting nurses from another country should pay every cost of bringing them, including fees collected by intermediaries it never deals with directly, and should not use an early-exit penalty to recover what it spent. I hold this view partly for reasons of decency, but I would not ask a board to fund it on decency alone. In Singapore and Malaysia every private hospital group is short of experienced nurses, and the value of a foreign-trained nurse lies in the second and third contracts, after the adaptation, the supervised practice and the first year of learning how a ward works. A recruitment model that loads the nurse with debt makes those later years less likely.

Private hospitals in this region depend on nurses trained in the Philippines, India, Myanmar and elsewhere. That dependence is not new and will not end soon. The World Health Organization's code of practice on the international recruitment of health personnel, adopted in 2010, asks recruiters to treat migrant health workers fairly and to consider the effect of recruitment on countries with their own shortages. It does not settle who should pay. In practice, in much of the region, the nurse pays, often before the employer has met them.

The fee we could not see from Singapore

I first sat on an overseas interview panel in 2004, in Manila, for the hospital where I was then a nurse manager. The candidates were impressive and the process looked orderly from our side of the table. Months later, several nurses who had joined my intensive care unit told me what they had paid to reach that interview and to complete the paperwork afterwards. One was repaying a loan from her family out of a salary she was also sending home. When I raised it, my director of nursing agreed it was wrong and said, accurately, that it happened before the nurse reached our door.

That answer stayed with me for fifteen years, until I was in a position to test it. In 2019, at Aravelle, I asked our Singapore hospitals to survey every foreign-trained nurse who had arrived that year. Of those who answered, 71% said they had paid someone in the recruitment chain. The median amount was about four months of their Singapore salary. Some had paid more than once: a local recruiter in their home province, an agency in their capital city and a placement charge in Singapore.

Singapore regulates what licensed local employment agencies may charge workers, and those rules matter. They cannot reach a recruiter in a provincial town two countries away who passes candidates to an agency that passes them to us. A hospital that pays its own agency's fee and assumes the chain is clean is relying on a declaration made at the wrong end of it.

Why the penalty clause held the wrong nurses

Our contracts at the time carried a penalty for leaving within three years, intended to recover recruitment and training costs. It is a common arrangement, and I had once served a bond myself, as a sponsored trainee from Surabaya. Mine was reasonable: the hospital had paid my school fees, and I owed it three years. The foreign-trained nurses' penalty was different. They had already paid much of their own recruitment cost, and the clause recovered from them a second time what the hospital described as its own.

The data showed what the clause did. First-year attrition among these nurses was 26%, despite the penalty, because nurses in debt who were struggling found ways to leave or were released. Those who stayed until the end of the first contract renewed at a rate of 52%. The clause did not keep the nurses we most wanted; it kept nurses who could not afford to go and turned the contract's end into a date to leave. Nurses who were committed would have stayed without it.

What paying the whole cost bought

From 2020 we paid every recruitment cost ourselves. We cut our agencies from thirteen to four, each of which agreed to charge candidates nothing and to accept audits; two others declined the terms and left our list. Every candidate now declares directly to Aravelle, in their own language and before departure, anything they have paid to anyone. We fund a twelve-week paid adaptation period before supervised practice begins, with a preceptor on the same shift pattern, and we removed the early-exit penalty. Nurses who leave within six months repay their airfare, and nothing else.

The extra cost was about S$5,200 a hire, roughly S$1.5 million a year at our volumes. The less visible cost was speed. In 2021 we hired 205 foreign-trained nurses against a plan of 290, during a pandemic, and covered the gap with overtime and agency nurses at a premium. Our nursing directors bore that cost on their wards and told me so.

By 2023 first-year attrition among foreign-trained nurses was 11%, completion of supervised practice at the first attempt had risen from 88% to 95%, and renewal at the end of the first contract was 79%. The cost per nurse still with us after three years fell by about 18%. That last figure is the one I would show a sceptical director, because it is where the business case lives.

I also learnt how incomplete our first version was. In 2022 exit interviews revealed nine nurses who had paid a recruiter in their home province before reaching one of our four agencies. The agency had not charged them; someone upstream had. We repaid them S$41,000 in total and began annual audits in the source countries, interviewing candidates before they meet the agency. We have since stopped recruiting in two provinces where local hospitals told our partners they could not staff their own wards, which is the source-country concern the international code describes.

There are fair objections. A hospital paying full costs is at a disadvantage against one that does not, at least for a few years. Some candidates will still pay intermediaries and conceal it, because they fear losing the offer. And a group that removes its penalty clause may lose some nurses to competitors after the adaptation it funded. All three have happened to us in small numbers.

The question I would put to any hospital board that recruits abroad is simple. Ask management what a newly arrived nurse paid to reach the ward, and ask how management knows. If the answer depends on what the agency says, the board does not know. Then compare the cost of paying the whole chain with the cost of replacing the nurses who leave in debt. In our hospitals, the first was smaller.