• Contract (Bond) with my company

Dear Sir,

I have joined my company in Oct, 2013. I have signed a bond (contract) with the company that I will work with the company for a minimum of 3 years or If I leave before I will pay 3 month salary and serve for a notice period of 1 month. 

But, I got a good job opportunity with higher salary this month and I gave resignation from my position with a notice period of 1 week. Today my employer have threatened me that I have breached all the clauses and my relieving letter will not be provided to me. They also said that they will sue me.

I want to mention here that my two colleagues, who have resigned last month, they both have served a notice period of 1 week only and relieved by the company with relieving letter and FNF amount also without any challenge. They have signed the same contract as signed by me.

Please help me legally how I can give them notice and get my reliving letter and FNF amount.

Look forward to hearing from you.

Thanks & Regards,
Amit
Asked 2 years ago in Civil Law from Delhi, Delhi
You can ask them to terminate you by unauthorised absence .if you don't do so and resign they will take legal action of breach of contract.talk to them.find dome reason that they may terminate you other wise you will be at loss.so use some tactics.take some time from your new employer and convince him and work fir 3 mobths
Jeshma Mohandas KP
Advocate, Kozhikode
567 Answers
1 Consultations
3.5 on 5.0
Try to convince the employer taking precedence of previous employees.If not possible, then get the bond examined by some lawyer to challenge the same. If need arises, file a suit for being relieved.
S.P. Srivastava
Advocate, New Delhi
703 Answers
13 Consultations
4.8 on 5.0
Bonds, binding employees to an employer for a period of time, are not legal in India. By the parlance of justice, no company can make employees sign bonds of employment. The legal framework has endorsed that the relationship between an employee and employer is no longer a slave-master relationship. Those days are gone.
So most of the companies do not call them bonds. Agreements, on the other hand, are legal and binding on two or more parties who sign it. Because of this reason, most of the companies make the employees sign an agreement to serve them for a period of time. And to reinforce the legality of the document, the agreement will normally say that the employee will be imparted some form of training during the tenure of the employment, towards which the company will be spending some amount (the amount will normally be specified), and because of this, the employee agrees to serve the company for a specified period of time post this training etc.
Companies who have fought legal cases know this but get bond signed to retain employees by indirect threatening. Most bonds are illegal. Even by case laws, Govt. and PSUs have also lost cases on this subject.

If it is a routine service bond, you need'nt worry, nothing will happen. But if they have spent money/special efforts on you in reference to any specific clause in the bond, they have the right to recover the money from you, legally.

However as you mentioned that previous employee has resigned in similar manner, so would suggest you to convince your employer regarding the same. Further get the bond examined by a lawyer and if they have not spent money on you and that you have sufficient evidence which can proof that  they  do not have the right to recover the money from you, legally then you can send them a legal notice demanding them to relieve you and further in the said legal notice  you must specify those two cases and latter file suit.
Sudershani Ray
Advocate, New Delhi
192 Answers
25 Consultations
4.9 on 5.0
A. send ur co. legal notice asking them to give relieving letter and FNF amount asap.to you.

B.in ur legal notice refer the cases of 2 other employees   who have resigned last month after serving a notice period of 1 week only and relieved by the company with relieving letter and FNF amount also without any challenge 

C. if co. fails to respond to legal notice then file suit in labour court.

.
R.K. Nanda
Advocate, New Delhi
457 Answers
0 Consultations
3.8 on 5.0
1) terms of contract are sacrosanct 

2) if as per terms of your employment you have agreed to give notice period of 1 month and pay 3 months salary you would be bound by terms of your contract if you leave the organisation within period of 3 years . 

3) you have left the company only with notice period of 1 week . the company is justified in taking legal proceedings if you commit breach of terms of contract . the company spends money on your training and if inspite of money being spent on employee for training employee fails to work for the period mentioned in contract company can take legal proceedings 

4) it is necessary to go through the terms of contract signed by you . 

5) if company issues you legal notice contact a local lawyer and reply to the notice . you can give instances of other 2 employees who failed  to serve the notice period but have been issued relieving letter
Ajay Sethi
Advocate, Mumbai
23346 Answers
1221 Consultations
5.0 on 5.0
first of all try to settle the matter with your employer amicably, if they are not ready to settle the matter amicably then send a legal notice to them with all the details of another employees who resigned the same.
Nadeem Qureshi
Advocate, New Delhi
3537 Answers
130 Consultations
4.9 on 5.0
1. Bonds are not permissible under the law. Although you have equated 'bond' and 'contract', but these two expressions carry different meaning in legal parlance. The agreement which an employee signs at the time of his employment is sacrosanct and binds both the employer and employee. The rights and liabilities of employer and employee are subsequently governed by this agreement. Any deviation by either of them from the agreement entitles the other to bring requisite legal proceedings for breach of contract.

2. In your case the agreement mandated that in the event you desire to leave the company you shall pay the amount equivalent to the salary of 3 months and serve a notice period of 1 month. Since you have violated this clause in the agreement the company will now be legally justified to take out proceedings for breach of contract against you and recover the amount it spent on you, if any. 

3. That two of your colleagues were relieved by the company even though they had also violated the agreement the terms of which were verbatim to your agreement is no ground for you to claim from the company a treatment similar to the one extended to them. That one cannot reap any benefit from out of the illegality committed by another is a basic principle of law. The company can in its wisdom and discretion overlook the departure made by an employee from the contractual clauses. 

4. As I said earlier the rights and liabilities would flow out of the agreement made by you with the company. So get the same examined by a lawyer. You may issue through him a lawyer's notice to the company seeking the relieving letter. If company brings legal proceedings for breach of contract then contest it in the light of what has been incorporated in the agreement.
Ashish Davessar
Advocate, Jaipur
18183 Answers
449 Consultations
5.0 on 5.0
1)terms of contract  restraining you from joining any other company for period of one year is   void . 

2) it would be in violation of section 27 of contract act . 

3) however as far as payment of one month salary in case you leave the organisation within period of 3 years without serving notice period is concerned it is valid . 

4) the clause of payment of _________ as liquidated damages in case you leave the organisation within period of 3 years would be difficult  to  enforce if company has not spent any amount towards your training .
Ajay Sethi
Advocate, Mumbai
23346 Answers
1221 Consultations
5.0 on 5.0
In this case you can issue a resignation letter by registered post by attaching a cheque of your one month salary and see how they reply back then only take steps
Jeshma Mohandas KP
Advocate, Kozhikode
567 Answers
1 Consultations
3.5 on 5.0
Putting restriction for joining another company for one year is illegal,void and in violation of section 27 of Contract Act, Recovery of  an amount against damages for leaving services within three years will fail in case no expenditure is made towards  imparting training to you by the company. payment of salary in lieu  of notice is enforceable.
S.P. Srivastava
Advocate, New Delhi
703 Answers
13 Consultations
4.8 on 5.0
You have agreed & accepted that in any case, if you leave the company on your own accord, you will not join any other company, who is dealing, carrying business of same sector, for next 1 year from the date of leaving
The clause mentioned above , restraining you from joining any other organization is void and is in violation to section 27.Thus the same cannot be enforced.
You have agreed for a contract with the company for a period of 3 years starting October, 2013 ending November 2016. However, your services will continue after the end of contract period. If you decide to leave the company within the contract period, you shall pay Rs. ....... to the company for the breach of contract.
 With respect to above clause,as mentioned pertaining to liquidated damages, as mentioned earlier, if they have not spent money on your training and that you have sufficient evidence which can proof,then in such case the clause cannot be enforced. Further the clause pertaining to serving legal notice is valid
Sudershani Ray
Advocate, New Delhi
192 Answers
25 Consultations
4.9 on 5.0
1. You have an escape route in this matter,

2. You are to give one months notice or forfiet one month's salary in lieu thereof in addition to the specified amount for brach of contract,

3. You submit another letter to the Company enclosing a cheque for the balance 3 weeks salary in lieu of the balance notice period,

4. Settle the matter amicably with the Company otherwise they may refiuse to give you release letter for want of which it will be difficult for you to get a fresh job.
Krishna Kishore Ganguly
Advocate, Kolkata
12131 Answers
233 Consultations
5.0 on 5.0
give one month's prior notice instead of 1 week to co. in writing or forfeit one month's salary in lieu of notice.

rest of contents of contract are all illegal.
R.K. Nanda
Advocate, New Delhi
457 Answers
0 Consultations
3.8 on 5.0
1. The clause "You have agreed & accepted that in any case, if you leave the company on your own accord, you will not join any other company, who is dealing, carrying business of same sector, for next 1 year from the date of leaving" is legally invalid, whereas the preceding clauses are valid. However, the bone of contention in your case is not an embargo on your right to join another company doing the same business. The dispute relates to the company's refusal to relieve you in view of the fact that you did not resign in accordance with the terms of agreement. 

2. You were obligated to give one month's notice or forfeit salary of equivalent period to the company before leaving, failing which company refused to issue the relieving letter to you. 

3. It is in your interest to remit to the company the salary equivalent to the balance notice period of 3 weeks, whereafter company will be bound to issue the relieving letter to you. While many organizations do not insist on relieving letters from previous employers, professionally managed companies do insist on relieving letter from the past employer to ensure whether the mode of exit from previous employment was proper. The objective of insisting on a relieving letter is to not only ensure that the employee has fulfilled the terms and conditions of employment in his previous assignment, but to also ascertain aspects beyond this, like integrity issues, moral turpitude etc. Organizations which do not insist on relieving letter from the past employer seldom realise that they will be paid back by the same coin by the employees whom they have recruited without relieving letters. In other words, employees who have joined an organisation without a relieving letter will keep quitting employments without receiving a relieving letter. So if you wish to join professional companies having lucrative pay packages in the future then your emphasis should be on obtaining the relieving letter instead of saving the 3 week salary which you are obligated to pay.
Ashish Davessar
Advocate, Jaipur
18183 Answers
449 Consultations
5.0 on 5.0
The terms of contract both as to serving three months notice as well as non compete for one year are valid and justified. Try to placate your employer by quoting precedents.
H. S. Thukral
Advocate, New Delhi
520 Answers
125 Consultations
5.0 on 5.0
you are only pay the amount as mentioned in the contract, nothing more, they can not restrain to you for doing job in similar field.
Nadeem Qureshi
Advocate, New Delhi
3537 Answers
130 Consultations
4.9 on 5.0

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