Is service bond legal in India?
Being an active lawyer for the past 22 years, I can tell you that no company can hold an employee to work against their will in this country. Having that said, if a company bears some expenses for your training/visa, etc, you are required to pay the amount to break even incase you depart before your time period.
You have the right to obtain an itemized list of expenses incurred during your training period. This is usually always lesser than the bond amount. If the company denies you list and your relieving letter--You can take them to court.
We recently worked on a case involving an employee having a 2 lakh 2 year bond with L&T. L&T refused to give a relieving letter to the employee after 1 year of service. After the employee asked for the expenses incurred, L&T instead gave the relieving letter without any fuss.
I would request all employees who would like to break their bonds to not pay the bond amount but ask for the exact expenses incurred by the company and pay that amount to get the relieving letter.
Regards
Dr. TSG
From India, Madras
Acknowledge(0)
Amend(0)
1Being an active lawyer for the past 22 years, I can tell you that no company can hold an employee to work against their will in this country. Having that said, if a company bears some expenses for your training/visa, etc, you are required to pay the amount to break even incase you depart before your time period.
You have the right to obtain an itemized list of expenses incurred during your training period. This is usually always lesser than the bond amount. If the company denies you list and your relieving letter--You can take them to court.
We recently worked on a case involving an employee having a 2 lakh 2 year bond with L&T. L&T refused to give a relieving letter to the employee after 1 year of service. After the employee asked for the expenses incurred, L&T instead gave the relieving letter without any fuss.
I would request all employees who would like to break their bonds to not pay the bond amount but ask for the exact expenses incurred by the company and pay that amount to get the relieving letter.
Regards
Dr. TSG
From India, Madras
Acknowledge(0)Amend(0)
Hello Dr.TSG,
I am from Kerala. I am in a similar situation. I was a part of L&T till November 2011.I would say it is rather the same problem. I breached the service bond since I was denied certain benefits and I received rather a harsh treatment from the authorities. L&T sent me a legal notice which mentions about 2 lk bond money with 18% interest to be paid.
The point which you explained "list of expenses" is vague to me. What if the company produce a fake list of expenses? can you elaborate on that? Also please expatiate on the type of expenses which bond money can contain? For instance,Expense can be due to travel,accommodation etc.Will those be included in the bond amount.
Looking forward to hear from you.
Thanks and regards
Amenon.
From India, Ghaziabad
Acknowledge(0)Amend(0)
I am from Kerala. I am in a similar situation. I was a part of L&T till November 2011.I would say it is rather the same problem. I breached the service bond since I was denied certain benefits and I received rather a harsh treatment from the authorities. L&T sent me a legal notice which mentions about 2 lk bond money with 18% interest to be paid.
The point which you explained "list of expenses" is vague to me. What if the company produce a fake list of expenses? can you elaborate on that? Also please expatiate on the type of expenses which bond money can contain? For instance,Expense can be due to travel,accommodation etc.Will those be included in the bond amount.
Looking forward to hear from you.
Thanks and regards
Amenon.
From India, Ghaziabad
Acknowledge(0)Amend(0)
Hello Anand,
How many months did you serve with the company?
Companies like L&T will not provide anything fake. They will have to give you a break-down of all the expenses incurred like external software training, travel expenses, accommodation, etc. In any which case it is highly unlikely that this would be 2lakh. If you have served a considerable amount of time(1year+), you can get significant reduction in the bond amount. You may only need to pay what others pay when they leave after their notice period(2 month salary or less).
Please do not leave the company until you have sorted all of this. Do not abscond as then it is when they can send a notice. If you stay with the company until all is negotiated they cannot send you any legal notice.
Regards
From India, Madras
Acknowledge(0)Amend(0)
0
0
How many months did you serve with the company?
Companies like L&T will not provide anything fake. They will have to give you a break-down of all the expenses incurred like external software training, travel expenses, accommodation, etc. In any which case it is highly unlikely that this would be 2lakh. If you have served a considerable amount of time(1year+), you can get significant reduction in the bond amount. You may only need to pay what others pay when they leave after their notice period(2 month salary or less).
Please do not leave the company until you have sorted all of this. Do not abscond as then it is when they can send a notice. If you stay with the company until all is negotiated they cannot send you any legal notice.
Regards
From India, Madras
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Check Failed/Partial)-The user reply contains some inaccuracies. In India, companies can enforce service bonds for recovering training costs but must provide an itemized expense list. The bond amount can't exceed the actual expenses. Staying until negotiations are complete is wise but not a legal requirement.
0
0
Dr.TSG,
I am already out of the company.To be frank I am absconding since last November.I served in the company for 16 months(June 2010-November 2011).I had training for initial 8 months.We dealt with nothing.We had a couple of trips the total expense of which would never be more than 50 thousand. Moreover,I havent got LTA which sums upto 23000 Rs(which is a part of the salary). I was supposed to fetch this when I completed one year term.I was denied that too.I got the legal notice already.I am all set for giving a reply to them.Will it be advisable if I claim for the list of expenses and relieving paper?
Kindly clarify.
Thanks and regards
Amenon.
From India, Ghaziabad
Acknowledge(0)Amend(0)
0
0
I am already out of the company.To be frank I am absconding since last November.I served in the company for 16 months(June 2010-November 2011).I had training for initial 8 months.We dealt with nothing.We had a couple of trips the total expense of which would never be more than 50 thousand. Moreover,I havent got LTA which sums upto 23000 Rs(which is a part of the salary). I was supposed to fetch this when I completed one year term.I was denied that too.I got the legal notice already.I am all set for giving a reply to them.Will it be advisable if I claim for the list of expenses and relieving paper?
Kindly clarify.
Thanks and regards
Amenon.
From India, Ghaziabad
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Check Failed/Partial)-The user's reply is incorrect. It is advisable to claim for the list of expenses and the relieving paper based on the original post. This action aligns with the legal rights of the employee.
0
0
Dr. TSG,
I am facing a similar situation. I joined L&T Infotech 4 months back as a fresher and signed a similar bond of Rs 2 lakhs for 2 years. I want to leave the company now. What is the best way forward? Please suggest?
Regarding the expenses incurred, did you send them a legal notice asking them to list out the expenses incurred, or was it over email?
Regards
From India, Delhi
Acknowledge(0)Amend(0)
0
0
I am facing a similar situation. I joined L&T Infotech 4 months back as a fresher and signed a similar bond of Rs 2 lakhs for 2 years. I want to leave the company now. What is the best way forward? Please suggest?
Regarding the expenses incurred, did you send them a legal notice asking them to list out the expenses incurred, or was it over email?
Regards
From India, Delhi
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Check Failed/Partial)-The information provided by Dr. TSG regarding breaking a service bond in India is not entirely accurate. It is essential to understand the legal implications and process correctly.
0
0
Dr. TSG, I joined a company with a 2-year, 2 lakh bond. I was with the company for 33 days and was a very good performer among my peers. However, the environment created mental stress for me, affecting my performance and making me unhappy about continuing to work there. Consequently, I decided to leave the company on the 34th day, with 43 days of training still remaining. Ten days after my departure, they sent me my resignation. Now, six months later, they are asking me for the 2 lakh bond amount. What consequences might arise from this situation?
From India, Bangalore
Acknowledge(0)Amend(0)
0
0
From India, Bangalore
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Checked)-The company cannot demand the bond amount if you worked for only 33 days. They can only ask for expenses incurred during your training. Seek legal advice if needed. (1 Acknowledge point)
0
0
Hello Dr. TSG,
I am in a similar situation as your client, and with the same company. Could you please tell me what exactly has to be asked for, and if it has to be sent in the form of a legal notice or just a mail to the HR?
In desperate need of your help.
From India, Mumbai
Acknowledge(0)Amend(0)
0
0
I am in a similar situation as your client, and with the same company. Could you please tell me what exactly has to be asked for, and if it has to be sent in the form of a legal notice or just a mail to the HR?
In desperate need of your help.
From India, Mumbai
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Checked)-The expenses incurred during training should be requested from the company in writing, which can be done through an email or a legal notice for formal documentation. This ensures transparency and compliance with legal procedures. (1 Acknowledge point)
0
0
Yes sir, please guide I have joined a week ago and got a new offer so want to leave l&t ecc.please guide about the service bond thing
From India, Pune
Acknowledge(0)Amend(0)
0
0
From India, Pune
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Check Failed/Partial)-The information provided in the user reply is [B]partially incorrect[/B]. In India, service bonds are legal if they are reasonable and protect the employer's interest. Employees can be asked to pay back training costs but cannot be forced to work against their will. It's recommended to consult the specific terms of the bond and seek legal advice if needed.
0
0
Hello Sir,
I am working with L&T Infotech. It's been 1 year and 2 months. I have a bond period of two years, and if I leave before that, I have to pay 2 lakhs. I want to leave the company. What can be done so that I don't have to pay 2 lakhs? I am ready to pay 2 months' salary. Please help with this.
From India, Bengaluru
Acknowledge(0)Amend(0)
0
0
I am working with L&T Infotech. It's been 1 year and 2 months. I have a bond period of two years, and if I leave before that, I have to pay 2 lakhs. I want to leave the company. What can be done so that I don't have to pay 2 lakhs? I am ready to pay 2 months' salary. Please help with this.
From India, Bengaluru
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Check Failed/Partial)-The user's reply is incorrect. In India, employers cannot enforce service bonds with financial penalties. The employee can request an itemized list of training expenses and should not pay the bond amount.
0
0
Engage with peers to discuss and resolve work and business challenges collaboratively - share and document your knowledge. Our AI-powered platform, features real-time fact-checking, peer reviews, and an extensive historical knowledge base. - Join & Be Part Of Our Community.
Employer suit for breaking service bond within 3 yrs - Delhi HC 5.9.2014.pdf
Death while in service letter for pf death claim.docx
CiteHR.AI
(Fact Checked)-The explanation provided by the user regarding the list of expenses and the potential for a company to produce a fake list is accurate. Expenses incurred during training, travel, accommodation, etc., can be included in the bond amount. It's essential for the company to provide a genuine, itemized list of expenses to the employee. It is advisable for individuals in similar situations to seek clarity on the expenses incurred to ensure transparency and fairness. (1 Acknowledge point)