Need Legal advice on immediate resignation and breaking BOND contract
4 months ago
My employer got me signed a bond to serve the organisation for 2 year and If I leave before that then I am supposed to pay 1 Lakh rupees also they asked me to submit a cheque of the same amount (which I did not do initially) but later they blocked my salary and forced for the cheque which I submitted then.
After serving for 1.5 years I have resigned and quit the organisation(without serving the 90 days notice period)
They are asking me to pay 3 months salary + 1 Lakh Bond amount else they will take legal action against me.
Currently I am not working and not holding any offer of any of the MNCs .
I resigned due to discrimination at workplace with respect to promotion policy .
What legal options I do have ?? Please help.
A.Dear Client,
An employment bond doesn't establish a relationship between an employer and an employee until essential steps are taken to validate it. The validity of such bonds in India can be contested under Section 27 of the Indian Contract Act, 1872, which prohibits agreements restraining trade or profession. According to this law, an employment bond becomes illegal if it restricts an individual from pursuing a lawful profession or trade. Section 27 mandates that any agreement compelling an employee to serve an employer or imposing restrictions on joining a competitor is not valid. Employees have the right to resign, even if bound by a specific period in the employment bond. However, if an employer proves the employee's intention to disclose trade secrets by joining a competitor, a court may issue an injunction.
Section 73 of the Act addresses unliquidated damages, while Section 74 deals with liquidated damages, attracting compensation only if actual loss or damage occurs. Withholding relieving letters and final settlement dues from an outgoing employee is considered unfair labor practice. If legal action is taken against you and you are not a Manager/Supervisor but a workman under the Industrial Dispute Act, serve a legal notice and approach the Labor Commissioner's office for filing a complaint. Otherwise, file a civil suit in the Civil Court to seek appropriate relief.
Thankyou
An employment bond doesn't establish a relationship between an employer and an employee until essential steps are taken to validate it. The validity of such bonds in India can be contested under Section 27 of the Indian Contract Act, 1872, which prohibits agreements restraining trade or profession. According to this law, an employment bond becomes illegal if it restricts an individual from pursuing a lawful profession or trade. Section 27 mandates that any agreement compelling an employee to serve an employer or imposing restrictions on joining a competitor is not valid. Employees have the right to resign, even if bound by a specific period in the employment bond. However, if an employer proves the employee's intention to disclose trade secrets by joining a competitor, a court may issue an injunction.
Section 73 of the Act addresses unliquidated damages, while Section 74 deals with liquidated damages, attracting compensation only if actual loss or damage occurs. Withholding relieving letters and final settlement dues from an outgoing employee is considered unfair labor practice. If legal action is taken against you and you are not a Manager/Supervisor but a workman under the Industrial Dispute Act, serve a legal notice and approach the Labor Commissioner's office for filing a complaint. Otherwise, file a civil suit in the Civil Court to seek appropriate relief.
Thankyou
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A.Dear Client,
A service/employment bond itself does not create any relationship between an employer and an employee unless and until it is followed by the essential steps required to make the Bond valid and enforceable under the law. 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 of the Indian Contract Act,1872, 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. Further, Section 73 of the Act makes provision for unliquidated damages (not stipulated in a contract), 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. Withholding of relieving letter, F & F dues of an outgoing employee amounted to unfair labour practice on the part of the Employer. So, in the prevailing situation, if the Company takes any legal action against you and you are not holding the position of Manager/Supervisor but a workman as defined u/s.2(s) of the Industrial Dispute Act then after serving a legal notice to the Company, reach out to the office of the Labour Commissioner concerned for filing a complaint against the employer over alleged unfair labour practice to resolve the grievance. Otherwise, you need to file a civil suit against the Company in Civil Court seeking appropriate relief in the matter.
A service/employment bond itself does not create any relationship between an employer and an employee unless and until it is followed by the essential steps required to make the Bond valid and enforceable under the law. 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 of the Indian Contract Act,1872, 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. Further, Section 73 of the Act makes provision for unliquidated damages (not stipulated in a contract), 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. Withholding of relieving letter, F & F dues of an outgoing employee amounted to unfair labour practice on the part of the Employer. So, in the prevailing situation, if the Company takes any legal action against you and you are not holding the position of Manager/Supervisor but a workman as defined u/s.2(s) of the Industrial Dispute Act then after serving a legal notice to the Company, reach out to the office of the Labour Commissioner concerned for filing a complaint against the employer over alleged unfair labour practice to resolve the grievance. Otherwise, you need to file a civil suit against the Company in Civil Court seeking appropriate relief in the matter.
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A.Dear sir.
If you do not required experience certificate and reliving certificate then just ignore ex employers demands. Be understand that for small amount of Rupees one lakh he may not file cheque bounce case.
If you do not required experience certificate and reliving certificate then just ignore ex employers demands. Be understand that for small amount of Rupees one lakh he may not file cheque bounce case.
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