Hello,
I have a friend who is working with a reputed engineering company. That company had intiated one project for which company asked to sign a bond which demands that he work with them for 3 yrs.The issues with that bonds are as follows,
1.)The bond is one sided i.e. if he leaves the company before 3 years he has to pay 3 lac Rs.
2) Who so ever wants to be a part of that project has to sign the bond. But case is that HR dept. failed to get bonds from each member of team. Out of 70 persons only 10 persons signed the bond.
3)Does the notorisation of bond is compulsory. In this case bond is being signed by my friend in November'06 . Till date it is not yet notorised.
4) Is the bond valid and will he be required to pay the company the bond amount incase he decides to quit? Is there any law which can help him avoid this?
5.) Can the company hold back his relieving letter? on what ground?If yes, on what grounds. Can he take the company to court over this matter. If yes, which Act is applicable?
6) Out of 70 members atleast 25 members who were part of team but didnot signed the bond has been released by the company. Even two employees those had signed also got released. Incase he decides to leave he would be required to pay 3 lacs to the company. Now he has a superb job offer which he wants to accept.
On what ground he can obtain the releaving letter from the company ?.
Matter most urgent . Please reply ASAP
Thanks.
BN
From United States
I have a friend who is working with a reputed engineering company. That company had intiated one project for which company asked to sign a bond which demands that he work with them for 3 yrs.The issues with that bonds are as follows,
1.)The bond is one sided i.e. if he leaves the company before 3 years he has to pay 3 lac Rs.
2) Who so ever wants to be a part of that project has to sign the bond. But case is that HR dept. failed to get bonds from each member of team. Out of 70 persons only 10 persons signed the bond.
3)Does the notorisation of bond is compulsory. In this case bond is being signed by my friend in November'06 . Till date it is not yet notorised.
4) Is the bond valid and will he be required to pay the company the bond amount incase he decides to quit? Is there any law which can help him avoid this?
5.) Can the company hold back his relieving letter? on what ground?If yes, on what grounds. Can he take the company to court over this matter. If yes, which Act is applicable?
6) Out of 70 members atleast 25 members who were part of team but didnot signed the bond has been released by the company. Even two employees those had signed also got released. Incase he decides to leave he would be required to pay 3 lacs to the company. Now he has a superb job offer which he wants to accept.
On what ground he can obtain the releaving letter from the company ?.
Matter most urgent . Please reply ASAP
Thanks.
BN
From United States
dear friend,
i would suggest that ur relieving letter has to be issued. the only thing which is to be considered for what purpose the bond is executed and what exactly the subject matter is about?
if u r able to tell then the question arises about the payment of Rs.3lacs.
I would bring to ur notice that if there is any imparting of technology/training for enhancing ur skills then definitely u have to pay that cost since it would have been covered under the confidentiality clause in ur agreement.
strictly speaking as per the contract act,1872 and under section 27 of the act "agreement in restraint of tradeor business of any kind is to that extent void"but now-a-days becuase of globalisation the Hon'ble Courts are giving priorities to above said principle and allowing them only to the extent of recovery of the amount spent by the company.
as regards the notary u need not bother whether it has to be notarised or not because it does not affect the agreement which is duly singed by you.
hope that i could make it very clear.
ur friendly,
s.sateesh
mail:sateesh_sala@yahoo.com
From India, Hyderabad
2i would suggest that ur relieving letter has to be issued. the only thing which is to be considered for what purpose the bond is executed and what exactly the subject matter is about?
if u r able to tell then the question arises about the payment of Rs.3lacs.
I would bring to ur notice that if there is any imparting of technology/training for enhancing ur skills then definitely u have to pay that cost since it would have been covered under the confidentiality clause in ur agreement.
strictly speaking as per the contract act,1872 and under section 27 of the act "agreement in restraint of tradeor business of any kind is to that extent void"but now-a-days becuase of globalisation the Hon'ble Courts are giving priorities to above said principle and allowing them only to the extent of recovery of the amount spent by the company.
as regards the notary u need not bother whether it has to be notarised or not because it does not affect the agreement which is duly singed by you.
hope that i could make it very clear.
ur friendly,
s.sateesh
mail:sateesh_sala@yahoo.com
From India, Hyderabad
Thanks for the prompt reply.
point 1) It was initially decided that each member of the team has to sign the bond . Fact is only 10 out of 70 has signed the bond. Others restricted themselves from not signing the bond for several reasons.It was initially decided that other monetory benefits will also be provided after completion of the project but it was only orally told.Nothing is provided till date.
Point 2) Two employees who had signed the bond , had left organisation when project was incomplete & still they got released without any consent.
Point 3) Bond is only one sided . Nothing is mentioned in bond about what benefits is to be provided after completion of the 3 years.
Yes ,techical training was provided in the project which increased the skill sets of the employee.
Considering all these points weather company can stop releasing & ask for money amount.
From United States
point 1) It was initially decided that each member of the team has to sign the bond . Fact is only 10 out of 70 has signed the bond. Others restricted themselves from not signing the bond for several reasons.It was initially decided that other monetory benefits will also be provided after completion of the project but it was only orally told.Nothing is provided till date.
Point 2) Two employees who had signed the bond , had left organisation when project was incomplete & still they got released without any consent.
Point 3) Bond is only one sided . Nothing is mentioned in bond about what benefits is to be provided after completion of the 3 years.
Yes ,techical training was provided in the project which increased the skill sets of the employee.
Considering all these points weather company can stop releasing & ask for money amount.
From United States
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
Employer suit for breaking service bond within 3 yrs - Delhi HC 5.9.2014.pdf
Death while in service letter for pf death claim.docx