Breaking of Bond
6 months ago
I have signed 3 years of bond with a company on 500rs notarized stamp paper at the time of joining. After 10 moths of service including 3 months of notice period, i absconded the company.
Does the company can take any legal action?
Will it affect in any way for my next opportunity in abroad?
A.Dear Client,
In India, employment bonds are legally binding agreements between an employer and an employee. Typically, these bonds are signed to protect the employer's investment in training and other resources provided to the employee. If you have signed a bond for a specified period and you leave your job before completing that period, the company may take legal action against you.
If the bond you signed specified a duration of 3 years, and you leave after only 10 months, the company may claim that you have breached the bond agreement. Companies can take legal action against employees who breach bond agreements. This could include seeking compensation for any expenses or training costs they incurred as a result of hiring and training you. If the company decides to take legal action against you and you are found liable for breach of the bond, it may impact your ability to secure future employment or opportunities within India. However, the specific impact on your future job prospects would depend on the outcome of the legal proceedings and the willingness of potential employers to hire someone with such a history.
As for opportunities abroad, it's important to note that employment laws and regulations can vary from country to country. An adverse legal history related to employment bonds may or may not impact your chances of finding work abroad, depending on the specific requirements of the prospective employer and the local labor laws in the destination country.
In India, employment bonds are legally binding agreements between an employer and an employee. Typically, these bonds are signed to protect the employer's investment in training and other resources provided to the employee. If you have signed a bond for a specified period and you leave your job before completing that period, the company may take legal action against you.
If the bond you signed specified a duration of 3 years, and you leave after only 10 months, the company may claim that you have breached the bond agreement. Companies can take legal action against employees who breach bond agreements. This could include seeking compensation for any expenses or training costs they incurred as a result of hiring and training you. If the company decides to take legal action against you and you are found liable for breach of the bond, it may impact your ability to secure future employment or opportunities within India. However, the specific impact on your future job prospects would depend on the outcome of the legal proceedings and the willingness of potential employers to hire someone with such a history.
As for opportunities abroad, it's important to note that employment laws and regulations can vary from country to country. An adverse legal history related to employment bonds may or may not impact your chances of finding work abroad, depending on the specific requirements of the prospective employer and the local labor laws in the destination country.
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A.Dear Client,
When you tender your resignation and serve the notice period in terms of the contract of employment, then on the expiry of the notice period, the relationship between an employee and employer is severed/seized and your absence cannot be treated as unauthorized abandonment or absconding from service that does not invoke any disciplinary action or legal action against you even for breach of conditions of employment bond. 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 to 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. Further, Section 73 of the Contract Act makes provision for unliquidated damages (not stipulated in a contract), and Section 74 deals with liquidated damages (stipulated in a contract) and no compensation is attracted for mere breach of contract u/s.73. 74 of the Act unless such breach resulted in an actual loss or damage to the opposite party Employer. If the Company takes any legal action against you or serves any legal notice, get in touch with a Corporate Lawyer experienced in the subject of service matters for guidance and steps.
When you tender your resignation and serve the notice period in terms of the contract of employment, then on the expiry of the notice period, the relationship between an employee and employer is severed/seized and your absence cannot be treated as unauthorized abandonment or absconding from service that does not invoke any disciplinary action or legal action against you even for breach of conditions of employment bond. 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 to 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. Further, Section 73 of the Contract Act makes provision for unliquidated damages (not stipulated in a contract), and Section 74 deals with liquidated damages (stipulated in a contract) and no compensation is attracted for mere breach of contract u/s.73. 74 of the Act unless such breach resulted in an actual loss or damage to the opposite party Employer. If the Company takes any legal action against you or serves any legal notice, get in touch with a Corporate Lawyer experienced in the subject of service matters for guidance and steps.
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