I have been asked to payback the Hike what they have provided last year.
1 year ago
I put down the papers on 21 of September. The manager or HR hasn't contacted me for a week. Then I asked the manager. He said he acknowledged the mail but he hasn't talked about anything or replied back to the email. As per the offer letter I have mentioned my last working day as 21st October. Then the next day the Manager and HR shouted at me and blamed me very badly for 1hr. Then they asked me to pay 1.5 lakhs as the penalty for not serving one year after the hike. I have served 11 months and 22 days. I have 24 yearned leaves. As these people are not hearing anything from me properly. I proposed the mail stating I would serve those 8 days so I need not owe you anything. But for that too manager shouted at me about how I can talk with the CEO without CC me. They forced me to take the laptop and leave the premises immediately. I didn't talk about anything. They asked me to take a mandatory holiday till my notice period against my will. They have not credited my salary for the last month as well. On top of this, they asked me to pay the remaining amount to get an experience letter and documents. He threatens me that he can give bad reviews about me in background verification.
A.Dear client,
How long was your notice period for? and when did you inform them about leaving?
According to the usual company rule, if you leave the job without a notice period, you will have to pay a penalty like a salary for the remaining days and they might also withhold your documents.
There are no such rules which tell you cannot leave the company within 1 year of a hike in your salary. But if your company policy says it, and you might have definitely signed (an employment contract) while you joined the company. In that case, you will have to abide by it. But you can claim for your documents by initiating a legal proceeding.
How long was your notice period for? and when did you inform them about leaving?
According to the usual company rule, if you leave the job without a notice period, you will have to pay a penalty like a salary for the remaining days and they might also withhold your documents.
There are no such rules which tell you cannot leave the company within 1 year of a hike in your salary. But if your company policy says it, and you might have definitely signed (an employment contract) while you joined the company. In that case, you will have to abide by it. But you can claim for your documents by initiating a legal proceeding.
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A.Dear client,
Since the conditions of your workplace are hostile and pose a threat to your reputation and future endeavors it is imperative that you deal with this matter with the help of an experienced lawyer. We advise your primary focus to be coming out of the situation without reputational damage.
For the penalty, it is assumed that the papers of contract of employment would be reflecting the stipulation of mandatory service of 1 year after the hike, failure to which, penalty of 1.5 lakhs shall be imposed. Essentially you would have agreed to this stipulation to secure the employment. Hence since you are willing to serve the notice period and your employer is forcefully restricting you from doing so, it is an evident breach of contract, for which you can sue the employer with the help of a lawyer.
Also as per labor law bonds are applicable only if the company has spent money on the personal grooming and enhancement of the employees, but not just a training that helps employees perform better. Also to prove that the bond is legal, it should favor both parties.
Since you mentioned the threat of harm to reputation, Sec 503 provides protection to you in the following way-
Section 503 The Indian Penal Code
Criminal intimidation.—Whoever threatens another with any injury to his person, reputation or property, or to the person or reputation of any one in whom that person is interested, with intent to cause alarm to that person, or to cause that person to do any act which he is not legally bound to do, or to omit to do any act which that person is legally entitled to do, as the means of avoiding the execution of such threat, commits criminal intimidation.
Explanation.—A threat to injure the reputation of any deceased person in whom the person threatened is interested, is within this section. Illustration A, for the purpose of inducing B to desist from prosecuting a civil suit, threatens to burn B’s house. A is guilty of criminal intimidation.
Note- Resorting to file a suit or complaint should be your last option since the inconvenience arising out of these remedies causes financial and reputational strains. Hence we advise for an amicable resolution of your concerns and negotiation being the key element.
Hopefully this resolves your query, best wishes. Thank you.
Since the conditions of your workplace are hostile and pose a threat to your reputation and future endeavors it is imperative that you deal with this matter with the help of an experienced lawyer. We advise your primary focus to be coming out of the situation without reputational damage.
For the penalty, it is assumed that the papers of contract of employment would be reflecting the stipulation of mandatory service of 1 year after the hike, failure to which, penalty of 1.5 lakhs shall be imposed. Essentially you would have agreed to this stipulation to secure the employment. Hence since you are willing to serve the notice period and your employer is forcefully restricting you from doing so, it is an evident breach of contract, for which you can sue the employer with the help of a lawyer.
Also as per labor law bonds are applicable only if the company has spent money on the personal grooming and enhancement of the employees, but not just a training that helps employees perform better. Also to prove that the bond is legal, it should favor both parties.
Since you mentioned the threat of harm to reputation, Sec 503 provides protection to you in the following way-
Section 503 The Indian Penal Code
Criminal intimidation.—Whoever threatens another with any injury to his person, reputation or property, or to the person or reputation of any one in whom that person is interested, with intent to cause alarm to that person, or to cause that person to do any act which he is not legally bound to do, or to omit to do any act which that person is legally entitled to do, as the means of avoiding the execution of such threat, commits criminal intimidation.
Explanation.—A threat to injure the reputation of any deceased person in whom the person threatened is interested, is within this section. Illustration A, for the purpose of inducing B to desist from prosecuting a civil suit, threatens to burn B’s house. A is guilty of criminal intimidation.
Note- Resorting to file a suit or complaint should be your last option since the inconvenience arising out of these remedies causes financial and reputational strains. Hence we advise for an amicable resolution of your concerns and negotiation being the key element.
Hopefully this resolves your query, best wishes. Thank you.
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A.Dear Client
It seems that you have fallen into a wrong trap of joining and leaving a company. It is very important for you to ensure that you get your experience certificate and also they do not give any negative feedback in your background verification as this will impact your prospective jobs. Try to settle the matter with them amicably if possible and if it is not being done then you can take the help of a lawyer to send them a legal notice.
It seems that you have fallen into a wrong trap of joining and leaving a company. It is very important for you to ensure that you get your experience certificate and also they do not give any negative feedback in your background verification as this will impact your prospective jobs. Try to settle the matter with them amicably if possible and if it is not being done then you can take the help of a lawyer to send them a legal notice.
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A.Dear Sir,
Remedies available to employer and employee on breach of service bond
In the event of breach of employment bond, the employer might incur a loss and, therefore, may be entitled for compensation.4 However, the compensation awarded should be reasonable to compensate the loss incurred and should not exceed the penalty, if any, stipulated in the contract.5 Usually, the court determines the reasonable compensation amount by computing the actual loss incurred by the employer having regard to all circumstances of the case. Even if the bond stipulates payment of any penalty amount in the event of breach, it does not mean that the employer shall be entitled to receive the stipulated amount in full as compensation on the occurrence of such default; rather the employer shall be entitled only for reasonable compensation as determined by the court. While exploring alternate remedies available to the employer in the event of default by the employee, it would be interesting and worthwhile to discuss whether the employers are entitled to seek for reinstatement of their employee or obtain restraining order against the employee from joining any competitor/alternate employer because many such similar reliefs have been sought by the employers in various suits. The apex court, while dealing with similar query, has held that the specific performance action cannot be sought for breach of contract of personal service or bond6 and, therefore, the employer shall not be entitled to seek for reinstatement of their employees as relief in the event of breach of bond. In another matter, the apex court has held that it is not bound to grant an injunction in every case and an injunction to enforce a negative covenant would be refused if it would indirectly compel the employee to idleness or to serve the employer7 and, therefore, the courts are also reluctant to grant injunction against the employees restricting their employment with other employer unless it is necessary for the protection proprietary interests or trade secrets of the employer.
As mentioned, the conditions stipulated in the employment bond should be reasonable in order to be valid and, therefore, even if unreasonable condition/clauses are stipulated in the contract such as imposing exorbitant duration of compulsory employment period or huge penalty upon the employee, the court shall award compensation only if it determines that the employer has incurred loss by such breach of contract. The court normally considers the actual expenses incurred by the employer, the period of service by the employee, conditions stipulated in the contract to determine the loss incurred by the employer to arrive at the reasonable compensation amount. For instance, in the case of Sicpa India Limited v ShriManasPratim Deb,8 the plaintiff had incurred expenses of INR 67,595 towards imparting training to the defendant for which an employment bond was executed under which the defendant had agreed to serve the plaintiff company for a period of three years or to make a payment of INR 200,000. The employee left the employment within a period of two years. To enforce the agreement the employer went to the court, which awarded a sum of INR 22,532 as compensation for breach of contract by the employee. It is crucial to note that though the bond stipulates a payment of INR 200,000 as compensation for breach of contract, the judge had considered the total expenses incurred by the employer and the employee's period of service while deciding the compensation amount. Since the defendant had already completed two years of service out of the agreed three year period, the judge divided the total expenses of INR 67,595 incurred by the plaintiff into three equal parts for three years period and awarded a sum of INR 22,532 as reasonable compensation for leaving the employment a year before the agreed time period. Similarly, the High Court of Andhra Pradesh in the case of Satyam Computers v Leela Ravichander,9had also reduced the compensation amount considering the period of service of the employee.
In view of the aforesaid discussions and various court decisions, the employment bond is considered to be reasonable as it is necessary to protect the interests of the employer. However, the restrains stipulated upon the employee in the said contract should be "reasonable" and "necessary" to safeguard the interests of the employer or else the validity of the bond may be questioned. The employees are always free to decide their employment and they cannot be compelled to work for any employer by enforcing the employment bond. The court can; however, issue order restricting the employment of the employee only if the said action is deemed necessary to safeguard the trade secrets/proprietary interest of the employer. In the event of breach of contract by the employee, the only remedy available to the employer is to obtain a reasonable compensation amount. The compensation amount awarded shall be based upon the actual loss incurred by the employer by such breach.
Remedies available to employer and employee on breach of service bond
In the event of breach of employment bond, the employer might incur a loss and, therefore, may be entitled for compensation.4 However, the compensation awarded should be reasonable to compensate the loss incurred and should not exceed the penalty, if any, stipulated in the contract.5 Usually, the court determines the reasonable compensation amount by computing the actual loss incurred by the employer having regard to all circumstances of the case. Even if the bond stipulates payment of any penalty amount in the event of breach, it does not mean that the employer shall be entitled to receive the stipulated amount in full as compensation on the occurrence of such default; rather the employer shall be entitled only for reasonable compensation as determined by the court. While exploring alternate remedies available to the employer in the event of default by the employee, it would be interesting and worthwhile to discuss whether the employers are entitled to seek for reinstatement of their employee or obtain restraining order against the employee from joining any competitor/alternate employer because many such similar reliefs have been sought by the employers in various suits. The apex court, while dealing with similar query, has held that the specific performance action cannot be sought for breach of contract of personal service or bond6 and, therefore, the employer shall not be entitled to seek for reinstatement of their employees as relief in the event of breach of bond. In another matter, the apex court has held that it is not bound to grant an injunction in every case and an injunction to enforce a negative covenant would be refused if it would indirectly compel the employee to idleness or to serve the employer7 and, therefore, the courts are also reluctant to grant injunction against the employees restricting their employment with other employer unless it is necessary for the protection proprietary interests or trade secrets of the employer.
As mentioned, the conditions stipulated in the employment bond should be reasonable in order to be valid and, therefore, even if unreasonable condition/clauses are stipulated in the contract such as imposing exorbitant duration of compulsory employment period or huge penalty upon the employee, the court shall award compensation only if it determines that the employer has incurred loss by such breach of contract. The court normally considers the actual expenses incurred by the employer, the period of service by the employee, conditions stipulated in the contract to determine the loss incurred by the employer to arrive at the reasonable compensation amount. For instance, in the case of Sicpa India Limited v ShriManasPratim Deb,8 the plaintiff had incurred expenses of INR 67,595 towards imparting training to the defendant for which an employment bond was executed under which the defendant had agreed to serve the plaintiff company for a period of three years or to make a payment of INR 200,000. The employee left the employment within a period of two years. To enforce the agreement the employer went to the court, which awarded a sum of INR 22,532 as compensation for breach of contract by the employee. It is crucial to note that though the bond stipulates a payment of INR 200,000 as compensation for breach of contract, the judge had considered the total expenses incurred by the employer and the employee's period of service while deciding the compensation amount. Since the defendant had already completed two years of service out of the agreed three year period, the judge divided the total expenses of INR 67,595 incurred by the plaintiff into three equal parts for three years period and awarded a sum of INR 22,532 as reasonable compensation for leaving the employment a year before the agreed time period. Similarly, the High Court of Andhra Pradesh in the case of Satyam Computers v Leela Ravichander,9had also reduced the compensation amount considering the period of service of the employee.
In view of the aforesaid discussions and various court decisions, the employment bond is considered to be reasonable as it is necessary to protect the interests of the employer. However, the restrains stipulated upon the employee in the said contract should be "reasonable" and "necessary" to safeguard the interests of the employer or else the validity of the bond may be questioned. The employees are always free to decide their employment and they cannot be compelled to work for any employer by enforcing the employment bond. The court can; however, issue order restricting the employment of the employee only if the said action is deemed necessary to safeguard the trade secrets/proprietary interest of the employer. In the event of breach of contract by the employee, the only remedy available to the employer is to obtain a reasonable compensation amount. The compensation amount awarded shall be based upon the actual loss incurred by the employer by such breach.
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