Hi All,
I signed a 3-year service bond with the company (Automobile) for which I work as an Assistant Manager. The bond is on a 100 Rs. stamp paper. It involves providing technical training abroad (at the Parent company) in a specific area. However, upon reaching the actual location, I discovered that it's essentially about supplying manpower to the parent company, or one could say it's operator training in disguise. This training is intended for operators, not managers, as individuals from other countries receiving the same training are all operators, information which the company concealed from me. Now, the issue is that I signed the bond for the stated technical training, not for operator training. I informed the company about this discrepancy, but they are pressuring me to finish the training, threatening to jeopardize my career if I don't comply.
Nonetheless, there is only one month remaining for the training to be completed. My question is, if I leave before or after completing the training, what actions can they take against my career?
1. Can they take legal action against me for recovery?
From Japan, Iwata
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I signed a 3-year service bond with the company (Automobile) for which I work as an Assistant Manager. The bond is on a 100 Rs. stamp paper. It involves providing technical training abroad (at the Parent company) in a specific area. However, upon reaching the actual location, I discovered that it's essentially about supplying manpower to the parent company, or one could say it's operator training in disguise. This training is intended for operators, not managers, as individuals from other countries receiving the same training are all operators, information which the company concealed from me. Now, the issue is that I signed the bond for the stated technical training, not for operator training. I informed the company about this discrepancy, but they are pressuring me to finish the training, threatening to jeopardize my career if I don't comply.
Nonetheless, there is only one month remaining for the training to be completed. My question is, if I leave before or after completing the training, what actions can they take against my career?
1. Can they take legal action against me for recovery?
From Japan, Iwata
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Continued...
1. What is the process for the refund of the bond amount (Rs 5 lakhs) and how long does it take to resolve issues like this?
2. If they don't file the case, what options do they have? For example, not providing me with a relieving letter, etc.
3. The most crucial aspect is how I can navigate this situation without getting involved in any legal processes. In my field of expertise, individuals are acquainted with each other, and such a situation could leave a negative impression on potential employers. Please suggest a way out.
Thank you.
From Japan, Iwata
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1. What is the process for the refund of the bond amount (Rs 5 lakhs) and how long does it take to resolve issues like this?
2. If they don't file the case, what options do they have? For example, not providing me with a relieving letter, etc.
3. The most crucial aspect is how I can navigate this situation without getting involved in any legal processes. In my field of expertise, individuals are acquainted with each other, and such a situation could leave a negative impression on potential employers. Please suggest a way out.
Thank you.
From Japan, Iwata
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Sub-Service Bond
Since you have served almost the bond period with only one month remaining, it is better for you to complete that one month. In that case, you will be discharged from the bond, and thereafter, even if you leave the service, you need not pay the bond amount if it is linked only for the three-period. Otherwise, they may create problems of relieving and probably resort to legal action for the recovery of the bond amount for the breach of the bond.
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd.
Mumbai
Tel: 022-28324234
From India, Mumbai
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57Since you have served almost the bond period with only one month remaining, it is better for you to complete that one month. In that case, you will be discharged from the bond, and thereafter, even if you leave the service, you need not pay the bond amount if it is linked only for the three-period. Otherwise, they may create problems of relieving and probably resort to legal action for the recovery of the bond amount for the breach of the bond.
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd.
Mumbai
Tel: 022-28324234
From India, Mumbai
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Dear Mr. Saikumar,
I have the following doubts:
1. Is the bond between the employer and employee legally accepted?
2. Does the employer have the right to collect original documents (education certificates, passports, etc.) from the employee?
Regards,
Kumar M.
From India, Visakhapatnam
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I have the following doubts:
1. Is the bond between the employer and employee legally accepted?
2. Does the employer have the right to collect original documents (education certificates, passports, etc.) from the employee?
Regards,
Kumar M.
From India, Visakhapatnam
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Sub-service bond
A bond is a contract under Sec. 2(h) of the Indian Contract Act between the employee and the employer and is enforceable under Sec. 74 of the said Act whereby the employee agrees to render himself liable to pay a certain sum stipulated in the bond in case of breach of any obligation under the bond. So far as the retention of educational certificates is concerned, it is better to consult an advocate for proper guidance.
B. Saikumar HR & Labour Law Consultant Chipinbiz Consultancy Pvt. Ltd. Mumbai.
From India, Mumbai
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A bond is a contract under Sec. 2(h) of the Indian Contract Act between the employee and the employer and is enforceable under Sec. 74 of the said Act whereby the employee agrees to render himself liable to pay a certain sum stipulated in the bond in case of breach of any obligation under the bond. So far as the retention of educational certificates is concerned, it is better to consult an advocate for proper guidance.
B. Saikumar HR & Labour Law Consultant Chipinbiz Consultancy Pvt. Ltd. Mumbai.
From India, Mumbai
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Sub-service bond
Since the bond does not involve any transaction of sale or purchase of any property or asset or transfer of any property or asset, I do not think it requires any registration except executing on a stamped paper of appropriate value. However, a civil lawyer will be in a better position to reply.
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd
Mumbai
022-28324234
From India, Mumbai
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Since the bond does not involve any transaction of sale or purchase of any property or asset or transfer of any property or asset, I do not think it requires any registration except executing on a stamped paper of appropriate value. However, a civil lawyer will be in a better position to reply.
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd
Mumbai
022-28324234
From India, Mumbai
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Dear Sirs,
Thank you for the reply. The bond period is 3 years after completion of the training, and the training period itself is 6 months, during which I have completed 5 months of training. Effectively, 3 years and 1 month remain, and I would not like to serve that company for the remaining period.
Additionally, I have some concerns regarding the bond documents I signed, which I believe are seriously flawed:
1. They made me sign a bond originally intended for a different field of expertise. The first and second pages discuss training in those specified fields, not in my field of expertise.
2. The bond is one-way as it only addresses the company's interests, not the executant's.
Regards
From Japan, Iwata
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Thank you for the reply. The bond period is 3 years after completion of the training, and the training period itself is 6 months, during which I have completed 5 months of training. Effectively, 3 years and 1 month remain, and I would not like to serve that company for the remaining period.
Additionally, I have some concerns regarding the bond documents I signed, which I believe are seriously flawed:
1. They made me sign a bond originally intended for a different field of expertise. The first and second pages discuss training in those specified fields, not in my field of expertise.
2. The bond is one-way as it only addresses the company's interests, not the executant's.
Regards
From Japan, Iwata
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Dear Bond 3 These type of agreement are not valid in india.you can leave the organisation and employer can not take any action against you. please go through the attachment
From India, Delhi
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From India, Delhi
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Dear,
These types of bonds are not valid in a court of law. Section 27 of the Indian Contract Act states that "Every agreement by which any one is restrained from exercising a lawful profession, trade, or business of any kind is to that extent void." It means these types of bonds are void. Secondly, holding someone is a criminal offense under the Criminal Procedure Code for holding someone's property with dishonest intention.
I have the following doubts:
1. Is a bond between an employer and an employee legally accepted?
2. Does an employer have the right to collect original documents (education certificates, passports, etc.) from an employee?
Regards,
Kumar.M
From India, Delhi
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These types of bonds are not valid in a court of law. Section 27 of the Indian Contract Act states that "Every agreement by which any one is restrained from exercising a lawful profession, trade, or business of any kind is to that extent void." It means these types of bonds are void. Secondly, holding someone is a criminal offense under the Criminal Procedure Code for holding someone's property with dishonest intention.
I have the following doubts:
1. Is a bond between an employer and an employee legally accepted?
2. Does an employer have the right to collect original documents (education certificates, passports, etc.) from an employee?
Regards,
Kumar.M
From India, Delhi
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Mr. Malik,
Firstly, I thank you for the very informative article on negative covenants. There is no dispute that any contract restraining an employee from employing himself after leaving the company is void as it violates Sec. 27 of the Indian Contract Act. As far as the other queries are concerned, please refer to my earlier reply.
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd
Mumbai
Tel: 022-28324234
From India, Mumbai
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Firstly, I thank you for the very informative article on negative covenants. There is no dispute that any contract restraining an employee from employing himself after leaving the company is void as it violates Sec. 27 of the Indian Contract Act. As far as the other queries are concerned, please refer to my earlier reply.
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd
Mumbai
Tel: 022-28324234
From India, Mumbai
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