Employment Bond - I signed a Employment bond
9 months ago
I signed a Employment bond of 2 years, which was not executed on a stamp paper. It had 2 lakh Penalty if in case I broke the bond.
3 months back I resigned from that job because of too much work pressure, now they are sending me Legal notice to pay 10 Lakh( The loss company Incurred since I left the project mid way) + 2 Lakh ( the Actual bond amount). 12 Lakhs in Total.
Can someone help me on this please? Also, can the Bond which I signed be Stamped later on by my Employer for legal court proceedings?
A.Dear Client,
The validity of Employment bonds can be challenged on the basis of Section 27 of the Indian Contract Act,1872 which prohibits any agreement in restraint of trade and profession. The law states that an agreement (employment bond) will be illegal only if it restrains someone from exercising a lawful profession/ trade/ business. As per the mandate of Section 27, any terms and conditions of an agreement that directly or indirectly compels the employee to serve the employer or puts a restriction on them joining the competitor or other employer is not valid. The employee has the right to resign from the employment even if he has agreed in the employment bond to serve the employer for a specific period of time. In the case where the employer is able to prove that the employee is joining the competitor to disclose the trade secret then the court may issue an injunction order restricting the employee from joining the competitor. The following are the requirements of a valid employment bond agreement. 1) The agreement must be signed by the parties with free consent. 2) The conditions stipulated must be reasonable and 3) The conditions imposed on the employee must be proved to be necessary to safeguard the interest of the employer. 4) The employment bond is to be executed on a stamp paper of appropriate value in order to be valid and enforceable. Reach out to a Corporate Lawyer experienced in the subject for guidance and steps.
The validity of Employment bonds can be challenged on the basis of Section 27 of the Indian Contract Act,1872 which prohibits any agreement in restraint of trade and profession. The law states that an agreement (employment bond) will be illegal only if it restrains someone from exercising a lawful profession/ trade/ business. As per the mandate of Section 27, any terms and conditions of an agreement that directly or indirectly compels the employee to serve the employer or puts a restriction on them joining the competitor or other employer is not valid. The employee has the right to resign from the employment even if he has agreed in the employment bond to serve the employer for a specific period of time. In the case where the employer is able to prove that the employee is joining the competitor to disclose the trade secret then the court may issue an injunction order restricting the employee from joining the competitor. The following are the requirements of a valid employment bond agreement. 1) The agreement must be signed by the parties with free consent. 2) The conditions stipulated must be reasonable and 3) The conditions imposed on the employee must be proved to be necessary to safeguard the interest of the employer. 4) The employment bond is to be executed on a stamp paper of appropriate value in order to be valid and enforceable. Reach out to a Corporate Lawyer experienced in the subject for guidance and steps.
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A.Dear Sir,
There are so many hurdles for the employer to file a suit for recovery of such amount and your advocate may answer and see that such suit is dismissed if filed. Just ignore such notice and engage advocate only if you receive court summons.
There are so many hurdles for the employer to file a suit for recovery of such amount and your advocate may answer and see that such suit is dismissed if filed. Just ignore such notice and engage advocate only if you receive court summons.
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Anonymous
Replied 9 months ago
Thank you Dear sir
A.Dear client,
Regarding the employment bond, the enforceability of such bonds can vary depending on the laws of your country or state. In some jurisdictions, employment bonds may not be enforceable if they are considered to be a form of coercion or an unfair restriction on an individual's right to work. It's important to determine the specific laws governing employment contracts in your jurisdiction.
As for the issue of stamping the bond later on for legal court proceedings, again, the requirements can vary depending on your jurisdiction. In some cases, documents that are not stamped at the time of execution may not be admissible as evidence in court. However, it's best to consult with a lawyer who is familiar with the laws of your jurisdiction to get accurate advice on this matter.
Regarding the legal notice you received, it's important to take it seriously and consult with a lawyer promptly. They will be able to review the notice, assess the validity of the claims made against you, and advise you on the best course of action.
Regarding the employment bond, the enforceability of such bonds can vary depending on the laws of your country or state. In some jurisdictions, employment bonds may not be enforceable if they are considered to be a form of coercion or an unfair restriction on an individual's right to work. It's important to determine the specific laws governing employment contracts in your jurisdiction.
As for the issue of stamping the bond later on for legal court proceedings, again, the requirements can vary depending on your jurisdiction. In some cases, documents that are not stamped at the time of execution may not be admissible as evidence in court. However, it's best to consult with a lawyer who is familiar with the laws of your jurisdiction to get accurate advice on this matter.
Regarding the legal notice you received, it's important to take it seriously and consult with a lawyer promptly. They will be able to review the notice, assess the validity of the claims made against you, and advise you on the best course of action.
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Anonymous
Replied 9 months ago
Thank you sir
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