• Breach of employment agreement

I am working as an IT Professional in an organization from 1st April 2013-present date.
At the time on joining i signed 2 years agreement with the organization worth 1 Lakh INR which is ending on 31st March 2015.
From past 6 months at this organization i have no project and sitting idle which i presume will spoil my career.  Also company has provided me a training worth 32,000 INR
I have resigned from my current position and my last day is 20th November, but they are asking for complete amount 1,32,000 INR for remaining four months also. I have no issues in paying them 32,000 for training and the remaining four months on the pro-rata basis but they are not agreeing that i have tried conveyancing them multiple times. They said once you pay the full amount then only they will give the relieving and experience letter, the company which i am joining is asking to submit the relieving letter at the time of joining which is on 24th this month. If i don't pay them they will not relieve me and i would not be able to join the other company, which may spoil my career. Is there a way if i pay them for now and get my relieving letter and after that send them a legal notice to compensate me for the recovered amount, if i file a suit is there any chance that they create problems at the time of background verification for new employer, please suggest a legal way.
Asked 3 years ago in Labour from Bangalore, Karnataka
If in the terms and conditions of your service agreement there is a clause regarding payment of full year then you may need to pay. However, if it talks about pro rata basis then your claim is valid. 

Otherwise, If you pay now they will not refund the amount. I suggest you first make a formal representation to the higher authorities of your company asking them to address your grievance.  Let them give a written reply to you. If they dont agree then pay the amount under protest and thereafter you can send a legal notice through a advocate.
Shaveta Chaudhary (Sanghi)
Advocate, Chandigarh
843 Answers
63 Consultations

5.0 on 5.0

You can use the mobile recordings as valid proof.  I still suggest that you make a formal written representation aswell.  That will help you when you file a caseagainst them in court. 

Further, When you pay the amount,  do mention that you are paying under protest.  After they give you a reliving letter and you join another company,  send them a legal notice asking them to refund. Give them 15 days time. If they don't then file a case.
Shaveta Chaudhary (Sanghi)
Advocate, Chandigarh
843 Answers
63 Consultations

5.0 on 5.0

Without looking into the agreement between the employer and the employee, it would not be correct to advice.  However you can approach the concerned person(HR)requesting him to waive Rs.1 lakh in your case, since the agreement is going to end on 31st March 2015 and you are ready to pay the cost of Rs.32000/- incurred by the Company towards your training
Shashidhar S. Sastry
Advocate, Bangalore
1616 Answers
107 Consultations

5.0 on 5.0

Get the relieving letter  and experience letter by paying the demanded  amount. secure your new job , once you are sure on the new job, send the ex employer a legal notice and initiate a legal proceedings. Your  ex -company's  the so called agreement and its one sided clauses can be challenged and you can recover the amount. 
Regarding the cost to the company 32,000/ you need to see if any other terms were agreed and it was not disclosed to you, as usually the companies come up with a defense  of matter of internal policy.
Thresiamma G. Mathew
Advocate, Mumbai
1510 Answers
134 Consultations

5.0 on 5.0

The amount mentioned in the appointment letter is by way of liquidated damages which are payable by the party to a contract in case of breach of agreement by it.  However the same are not on demand and the claimant has to show a loss occurred to him on such breach. In your case since the employer spent Rs. 32000/- on your training, he is justified in claiming the said amount and not more. 
Your problem is that you have to join the new company and has to produce a relieving letter from your existing employer which is not coming due to his adamant stand. You can't resort to litigation at this stage and get a quick resolution as you don't have time for that. So you have to pay if you want new job. Pay the amount under protest on record that you are paying it because the employer is refusing to relieve you with full and final settlement. You may bring a suit for recovery later on.
H. S. Thukral
Advocate, New Delhi
556 Answers
166 Consultations

5.0 on 5.0

1. The appointment letter is required to be seen,

2. If there is a bond of 1 lakh & cost of training to pay in case of leavin before the agrred period, then you shall have to abide by it,

3. If thre is no such thing then your paying amount equivalent to your balance period/s salary in addition to the trainning cost is justifiable,

4. Since without releaving letter, you can not join the new Company, I will suggest you to pay the demanded amount, take release letter, join the new company, then file a suit claiming the additional amount taken by them with damage, interest & cost,

5. Meantime, try to collect evidence of the Company's such illegal claim ijn thre form of letter &/or Audio/Video recording.
Krishna Kishore Ganguly
Advocate, Kolkata
18112 Answers
438 Consultations

5.0 on 5.0

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