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Corporate Legal Compliances
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Thread Started by #amitkishore

Dear All,

Recently I got interesting judicial pronoucement of breach of bond, according which such agreement are not against public policy and not void.Please check the attachmnet.Further, I Like to share following view with you:-
Whether particular service contract is valid or not is totally depends upon the terms and conditions contained therein, the manner in which it is drafted subject to various provisions of law.

Suppose if an agreement of training contained a provision that employee has to serve the company for 2 year after completeion of training abroad and in case if he leave before said period he is liable to pay damages to the employer say equal to 6 months salary not illegal/void.

In various judicial reveiw court held that such restriction are not treated as 'restrain in trade' hence not violative section 23/27 of contract act nor fundamental right u/a 19.
But drafting must be done carefully and restriction must not for post-employement period and it must be genuine to receover cost of training.

Employee is free to leave but they have to compensate the company,,,in my opinion such employee can not be allow to take laddu in both hands..means taking fruits of training, joining competitor and levaing it old employer in the mid of business set is totaly immoral and unethical/non professional attitude.Ya if they want to leave they can leave but pay cost of training.

Please check the attached article and judicial prouncement.


aMIT kishore singh
15th February 2010 From India, Delhi

Attached Files
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File Type: pdf High Court Judgement on Breach of Bond and Quantum of Compensation.PDF (3.51 MB, 2548 views)

What if company takes/forces bond by employee in the name of training and makes him work onsite for more than 10 hours and earns profit by invoicing to the client. Is this a clear abuse of training program to extract routine work by organization. Most of the companies have misused this condition of law to recover dues in name of specialized training.
Please share your comment on this.
15th June 2011 From India
Hi Amit,
Good work, I have been looking for such things since long..I'm sure many of our members will get their answers through this peace of work.
Keep sharing such informative posts...
15th June 2011 From India, Delhi
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