{"id":1584,"date":"2019-03-27T07:30:07","date_gmt":"2019-03-27T07:30:07","guid":{"rendered":"https:\/\/labourlawadvisor.in\/blog\/?p=1584"},"modified":"2024-01-24T10:08:30","modified_gmt":"2024-01-24T10:08:30","slug":"employment-bond-details","status":"publish","type":"post","link":"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/","title":{"rendered":"This is how you can break an employment bond with a company"},"content":{"rendered":"\n<p>Hello, good people of the internet, we welcome you to another blog of Labour Law Advisor on employment bond. The blog here will talk informatively about bonds to you today. <br><br>To start it off, let&#8217;s say that no employment bond has the authority to keep you working for the same job, well did you know that? Also with that did you know that the amounts written in the bonds aren&#8217;t payable for you? Are employment bonds legal or not? What are the clauses that can turn an employment bond into an illegal one? <br><br>With that, if you are newly employed and don&#8217;t have a single idea about employment bonds, then this blog is going to suffice the purpose for you. Most of you might be already working under a contract. The chances of working with an employer in the future who also asks you to sign a bond are very high. Read on to know more about employment bonds and other things related to employment in this blog.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"576\" height=\"1024\" src=\"https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-576x1024.jpg\" alt=\"\" class=\"wp-image-10981\" srcset=\"https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-576x1024.jpg 576w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-169x300.jpg 169w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-768x1365.jpg 768w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-864x1536.jpg 864w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-1152x2048.jpg 1152w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-150x267.jpg 150w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-300x533.jpg 300w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-696x1237.jpg 696w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-1068x1899.jpg 1068w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-1920x3413.jpg 1920w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-236x420.jpg 236w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2021\/02\/Vertical-Thumbnail-01-min-1-2-3-4-5-6-scaled.jpg 1440w\" sizes=\"(max-width: 576px) 100vw, 576px\" \/><\/figure><\/div>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-66345b8e0d786\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-66345b8e0d786\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#Employment_Bond_All_you_need_to_know_about_it\" title=\"Employment Bond | All you need to know about it \">Employment Bond | All you need to know about it <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#What_is_a_Valid_Employment_Bond\" title=\"What is a Valid Employment Bond? \">What is a Valid Employment Bond? <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#When_can_an_employer_enforce_the_terms_from_the_employment_bond_contract_to_an_employee\" title=\"When can an employer enforce the terms from the employment\nbond contract to an employee? \">When can an employer enforce the terms from the employment\nbond contract to an employee? <\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#Resignation_before_Bond_Duration\" title=\"Resignation before Bond Duration:\">Resignation before Bond Duration:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#Post_Termination_Obligation\" title=\"Post Termination Obligation:\">Post Termination Obligation:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#Confidentiality_Clause\" title=\"Confidentiality Clause: \">Confidentiality Clause: <\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#How_can_the_Employees_stand_against_the_Bonds\" title=\"How can the Employees stand against the Bonds?\">How can the Employees stand against the Bonds?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#Final_Words\" title=\"Final Words:\">Final Words:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/labourlawadvisor.in\/blog\/employment-bond-details\/#Do_check_out_our_YouTube_video_on_the_detailed_explanation_of_an_Employment_Bond\" title=\"Do check out our YouTube video on the detailed explanation of an Employment Bond: \">Do check out our YouTube video on the detailed explanation of an Employment Bond: <\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Employment_Bond_All_you_need_to_know_about_it\"><\/span>Employment Bond | All you need to know about it <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The most common definition of a bond is a document which bounds you to serve for a job. <\/p>\n\n\n\n<p>On the other hand, the legal definition for a bond is an\nagreement between the employer and the employee, an understanding with a\nnegative covenant covered under the Indian Contract Act, 1872. The contract\nwith negative covenants is valid and legally enforceable if the parties agree\nwith their free consent, and without influence, undue, coercion, fraud, mistake\nand misrepresentation. <\/p>\n\n\n\n<p>In simple terms, it means that both the employer and the\nemployee should freely consent the bond without any external pressure or other\nfactors mentioned above. But there are several other clauses which can turn the\nemployment bond into an invalid one.<\/p>\n\n\n\n<p>You might be wondering about what a negative covenant is\nafter reading the legal definition of a bond. Well, it is a contrary agreement\nthat stops you from doing work. Something that doesn&#8217;t make you bound to work\nbut something that prevents you from working. <\/p>\n\n\n\n<p>Generally, there are three main types of negative covenants in use surrounding a bond. <\/p>\n\n\n\n<h5 class=\"wp-block-heading\">1. Duration of Stay with the Firm:<\/h5>\n\n\n\n<p>This part from the agreement of contract fundamentally\ndecides the time-period you are going to work with the firm.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">2. Not joining Competitor after Exit for a certain time period:<\/h5>\n\n\n\n<p>It states that for example, a worker in the sales sector is\nworking for an educational publication house where his job is to distribute the\nbooks to various clients including students, schools and other distributors. In\nthis case, if the person is leaving the sales job to join the educational\npublication house, then he is not allowed to join any other publication house\nfor the next 12-18 months.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">3. Confidentiality:<\/h5>\n\n\n\n<p>It states that person leaving the job cannot share any\ninformation with a competitor firm related to data, software, business\narchitecture, terms of service and various other miscellaneous confidential\nmatters associating with the company the person is leaving. <\/p>\n\n\n\n<p>We will know more about all these aspects in detail further\nin this blog. <\/p>\n\n\n\n<p>Also, to bring to your knowledge that a good article relating to all the negative covenants is out there by a Supreme Court advocate Mr Dilip Goswami. We will share the same in our <a href=\"http:\/\/t.me\/JoinLLA\">telegram group<\/a>. <\/p>\n\n\n\n<p>For now, let us first understand the type of bonds that\nstand valid.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_a_Valid_Employment_Bond\"><\/span>What is a Valid Employment Bond? <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>The agreement has to be signed by both the parties at their free consent.<\/li><li>The conditions mentioned in the bond have to be reasonable and reflect the expenditure of the company on the Employee.<\/li><li>The conditions imposed on the bond must be satisfactory to safeguard the interest of the employer.<\/li><li>Every bond will stand valid only when it is executed on a stamp paper of an appropriate value and enforceable.<\/li><li>Ensure that there is training material that will stand as evidence and proof in the court stating that the employee was given sufficient training.<\/li><li>The agreement must have a non-competition clause and confidentiality clause to ensure the company&#8217;s trade secrets are protected and secure.<\/li><\/ul>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" loading=\"lazy\" width=\"487\" height=\"630\" src=\"https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2019\/03\/Example-of-bond.jpeg\" alt=\"employment bond\" class=\"wp-image-1598\" srcset=\"https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2019\/03\/Example-of-bond.jpeg 487w, https:\/\/labourlawadvisor.in\/blog\/wp-content\/uploads\/2019\/03\/Example-of-bond-232x300.jpeg 232w\" sizes=\"(max-width: 487px) 100vw, 487px\" \/><\/figure><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"When_can_an_employer_enforce_the_terms_from_the_employment_bond_contract_to_an_employee\"><\/span>When can an employer enforce the terms from the employment\nbond contract to an employee? <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Employment bonds are enforceable if the following\nrequirements are satisfied: <\/p>\n\n\n\n<ul><li>The employer has spent money on the employee for training and grooming-related purposes.<\/li><li>The said expenditure is in place of a promise from the employee that he or she would not leave the employment for the duration specified in the contract. <\/li><\/ul>\n\n\n\n<p>To summarize it, we will again discuss a case of fraud as an example. If your employer didn&#8217;t spend single money on your training, then they cannot levy a penalty against you at the time of your exit. If your employer is doing so, then it is entirely an act of fraud. <\/p>\n\n\n\n<p>Now we will know the rulings declared by the court regarding the three main types of negative covenants in an employer bond. We will also find out whether the decisions have been in favour of the employer or the employee.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Resignation_before_Bond_Duration\"><\/span>Resignation before Bond Duration:<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The most important case that went to the court concerning\nthis situation was the case between Sicpa India Limited and Shri Manas Pratim\nDeb. Where the company stated that employee Manas had to work with them for a\nduration of 36-months. Leaving the contract in between will lead to a penalty\namount of Rs. 200,000 payable to the company.<\/p>\n\n\n\n<p>In this case, the court asked the employer to reveal the actual expense spent on the employee for his training which was Rs. 67,595. The court was in favour of the employee and considering the situation that the employee has served the company for a period of 2-years declared the amount payable to the company as Rs. 22,532 only.<\/p>\n\n\n\n<p>The case makes it clear that no matter what amount is there\nin the employment bond, the employer will utterly pay what is reasonable\nconsidering the circumstances. Or only the amount that might affect as a loss\nto the company shall be paid by an employee. <\/p>\n\n\n\n<p>The company mentions a hefty amount on a bond only to hold\nan employee for a long term basis. <\/p>\n\n\n\n<p>At the same time, the court is always for the employee.\nAlso, the training given by the company is to benefit the company only, and it\nis not the other way around. Hence a fair amount is declared by the court\nirrespective of what is there in the bond. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Post_Termination_Obligation\"><\/span>Post Termination Obligation:<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>There are a lot of cases surrounding this type of obligations. To state as an example the case between Tico Services Limited and Mr Kaushik Pal Chowdhury, where the employee signed a non-competitor clause of not joining another employer providing services in the same sector. The court here again declared the decision in favour of Mr Chowdhury stating that the company cannot make an employee sign such a clause. <\/p>\n\n\n\n<p>There are many cases under the same obligation which you can know by watching our YouTube video on the same topic below. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Confidentiality_Clause\"><\/span>Confidentiality Clause: <span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>In this case, if a worker in the sales sector of a company\nthinks that he\/she can share the data with other companies while transferring,\nthen it is legally wrong to share the data he\/she is gathering while working\nfor the previous company. As the company owners are paying you the wage for\nserving them. <\/p>\n\n\n\n<p>Kris Lakshmikanth, CEO Head Hunters, says that the same shall be applied only for a course of time after which the employee can share the data with other companies or for personal benefits.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_can_the_Employees_stand_against_the_Bonds\"><\/span>How can the Employees stand against the Bonds?<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>In case you are facing harassment from one such firm who has\nyour documents and is trying to extort money out of you or forcing you to stay\nwith their company then let us find out the legal clauses that are standing\nwith you to claim your work-rights. <\/p>\n\n\n\n<ul><li>According to an Indian Statut which says that an act of bonded labour does not exist anymore today, which means that you cannot hire an employee with a fixed contract or a bond. <\/li><li>Article 19 of the Indian Constitution which deals with the fundamental rights saying that a worker can serve freely in any organization irrespective of a bond or a contract. <\/li><li>According to the Indian Contract Act, any one-sided bond is considered null &amp; void. <\/li><li>Section 368 of Indian Penal Code states that any kind of extortion or harm to an employee by confiscating documents by the employer will sentence the company directors for 2+ years of jail.<\/li><\/ul>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Final_Words\"><\/span>Final Words:<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>So as far as we have come to know from the blog that if an employer is spending money on an employee&#8217;s training then either he\/she can serve the notice period for the company or pay a reasonable fine amount to cover the training cost that the company had to bear for the employee.<\/p>\n\n\n\n<p>Moreover, the recent cases of fraud where an employer is threatening an employee with hefty sums of money or by confiscating the employee&#8217;s documents are scam-cases wherein an employee should immediately contact an authorised body seeking for help. <br><br><a href=\"https:\/\/labourlawadvisor.in\/blog\/\">Do check out our&nbsp;Labour Law Advisor&nbsp;blog<\/a> section for other such important articles.  <\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Do_check_out_our_YouTube_video_on_the_detailed_explanation_of_an_Employment_Bond\"><\/span>Do check out our YouTube video on the detailed explanation of an Employment Bond: <span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<div class=\"youtube-embed\" data-video_id=\"Apcz-7hPoTw\"><iframe loading=\"lazy\" title=\"Can you \ud83d\udd34Resign after signing Bond with company? | Employment Contract Explained In Hindi\" width=\"696\" height=\"392\" src=\"https:\/\/www.youtube.com\/embed\/Apcz-7hPoTw?feature=oembed&#038;enablejsapi=1\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture\" allowfullscreen><\/iframe><\/div>\n<\/div><\/figure>\n\n\n\n<p>Join the LLA telegram group for frequent updates and documents. Download the telegram group and search \u2018Labour Law Advisor\u2019 or follow the link \u2013&nbsp;<a rel=\"noreferrer noopener\" href=\"http:\/\/t.me\/JoinLLA\" target=\"_blank\">t.me\/JoinLLA<br><\/a>It\u2019s FREE!  <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Hello, good people of the internet, we welcome you to another blog of Labour Law Advisor on employment bond. The blog here will talk informatively about bonds to you today. To start it off, let&#8217;s say that no employment bond has the authority to keep you working for the same job, well did you know [&hellip;]<\/p>\n","protected":false},"author":21,"featured_media":10991,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2260,2263,2257,2254],"tags":[236,237,238,183,182,234,235],"_links":{"self":[{"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/posts\/1584"}],"collection":[{"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/users\/21"}],"replies":[{"embeddable":true,"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/comments?post=1584"}],"version-history":[{"count":2,"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/posts\/1584\/revisions"}],"predecessor-version":[{"id":15622,"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/posts\/1584\/revisions\/15622"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/media\/10991"}],"wp:attachment":[{"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/media?parent=1584"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/categories?post=1584"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/labourlawadvisor.in\/blog\/wp-json\/wp\/v2\/tags?post=1584"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}