Such clauses are in nature of non-compete clauses which are not enforced in entirety by the courts in India. If your current employer terminates your services on this ground then you may challenge it in the civil court.
Legality of 'resignation acceptance letter'
Hi Sir/Ma'am, I have been working in IT company for one of the US clients. Once after I resigned from the company , they forced me to sign a paper entitled 'resignation acceptance and competence clause' which says that I should not work on the same client and project for the next 6months. Later I moved to an Indian company (on the same client/project which I was working), and they informed that my previous organisation rejected my background verification as I didn't comply with 'resignation acceptance letter and non-competence clause'. Could you please help me here, as I am about to loose my job on this, as present company says they can't accomodate anyone with a negative BGC. They are making laws as per what ever they want, even after my resignation. What can I do in such situation? I am really stressed out in this matter.
Asked 8 years ago in Labour
8 Answers
Hi, It has become unfair labour practice you can file a complaint in the Deputy Labour Commissioner against the Company.
We need to review the employment Agreement and other related documents to give you accurate advice on this regard.
Please share the extract of relevant clauses.
Non compete clause is not valid after you resign from company
2) under section 27 of Indian contract act any agreement in restraint of trade is void
3) )the Bombay High Court held that a restraint
operating after termination of the contract to secure freedom from competition from a person who no longer worked within the contract, was void. The court refused to enforce the negative covenant and held that, even if such a covenant
was valid under German law, it could not be enforced in India. (Taprogge
Gesellschaft MBH v. IAEC India Ltd., AIR 1988 Bom 157)
My previous employer still says that they are legally right stating the below document. This was signed after my resignation, but with dated the resignation date. https://drive.google.com/file/d/0B6fRwg7tWKfPZFBERlZGampZVFdGOUVDakRQbFMxS0F1NVlB/view?usp=sharing They are mentioning that there are some 'post' conditions, which bans me working for the same company I am working for for the next six months after the resignation period. I couldn't have left the company without signing this paper as well, as they will put me in red. I don't understand how I could have possibly left without breaking all these. They are very strictly saying this, and because this my present employer says, you can't continue in the same project. Please advise, if I have any hope on this. If legally sure, I would like to go for a case against them.
Asked 8 years ago
1) non compete clause is illegal in india
2) post resignation you cannot be restrained from working for competitor
3) Delhi High Court in Desiccant Rotors International Pvt Ltd v Bappaditya Sarkar & Anr(2009)
in this case Manager resigned and-notwithstanding the terms of his old employment agreement-within three months of his resignation joined a direct competitor of Desiccant as country manager in charge of marketing and started contacting customers and suppliers of Desiccant. In injunctive proceedings against the manager by Desiccant, the High Court reiterated the principles embodied in Section 27 of the Act and the individual’s fundamental right to earn a living by practicing any trade or profession of his or her choice. the court held that the right of livelihood of employees must prevail.
Could you please help me here, as I am about to loose my job on this, as present company says they can't accomodate anyone with a negative BGC. They are making laws as per what ever they want, even after my resignation. What can I do in such situation? I am really stressed out in this matter.
The rules or law is made for following it unless there cannot be any guidelines and no work can be accomplished.
If you had refused to sign the paper entitled 'resignation acceptance and competence clause' which says that I should not work on the same client and project for the next 6 months, your resignation would not have been accepted or your relieving may not be proper or even if everything is alright, the company may have the right to enforce their rules giving adverse certificate during the back ground verification. The new company may reject your employment considering you to be an undisciplined employee and it will not be advisable to employ a person who will not abide by the rules or law of the employment.
If your previous company has given such baseless report then you have rights to sue them for the damages as well as for defaming you spoiling your reputation in the society which rendered you heavy loss career wise as well as monetary wise.
Consult a local service ;law practicing advocate for initiating further action in this regard.
They are mentioning that there are some 'post' conditions, which bans me working for the same company I am working for for the next six months after the resignation period.
If the company is giving such reasons, you should go through the original employment offer letter given to you and signed by you at the time of joining the company and ensure if you had accepted and signed all those terms which are now being made as an issue by the company, if they are missing then you may first issue legal notice to the company demanding explanation for spoiling your career by giving an adverse background report about you to the new employer which renders you the loss of the new employment.
In that event let your past employer go to court to seek injunction against you, which you can contest in defence. You may file a caveat to prevent your past employer from walking away with a favourable order without your service.