A.
Dear Client,
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 to the employment bond to serve the employer for a specific period. In the case where the employer can 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 un-liquidated 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. 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 TCS over alleged unfair labour practice to resolve the grievance. To restrict IT Companies from exploiting their employees by playing double standards, the Division Bench of the Karnataka High Court in the case of Commissioner of Income Tax v. Texas Instruments India Pvt Ltd (2021) 435 ITR unambiguously held that the IT sector employees considered to be "workmen" under Section 2(s) of the Industrial Dispute Act, 1947. Additionally, you need to file an application under Sec.33C(2) of the I D Act against the Company before the Labour Court claiming recovery of F & F dues receivable to an ex-employee post-resignation. Reach out to an Advocate experienced in industrial disputes, labour court matters for advice and action/steps. Feel free to contact our legal team to navigate the issue in the right way.
Posted On 26-Jun-2024
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