Is Service Bond Legal in India?
Being an active lawyer for the past 22 years, I can tell you that no company can hold an employee to work against their will in this country. Having said that, if a company bears some expenses for your training/visa, etc., you are required to pay the amount to break even in case you depart before your time period.
You have the right to obtain an itemized list of expenses incurred during your training period. This is usually always lesser than the bond amount. If the company denies you the list and your relieving letter, you can take them to court.
We recently worked on a case involving an employee having a 2 lakh 2-year bond with L&T. L&T refused to give a relieving letter to the employee after 1 year of service. After the employee asked for the expenses incurred, L&T instead gave the relieving letter without any fuss.
I would request all employees who would like to break their bonds to not pay the bond amount but ask for the exact expenses incurred by the company and pay that amount to get the relieving letter.
Regards,
Dr. TSG
From India, Madras
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Being an active lawyer for the past 22 years, I can tell you that no company can hold an employee to work against their will in this country. Having said that, if a company bears some expenses for your training/visa, etc., you are required to pay the amount to break even in case you depart before your time period.
You have the right to obtain an itemized list of expenses incurred during your training period. This is usually always lesser than the bond amount. If the company denies you the list and your relieving letter, you can take them to court.
We recently worked on a case involving an employee having a 2 lakh 2-year bond with L&T. L&T refused to give a relieving letter to the employee after 1 year of service. After the employee asked for the expenses incurred, L&T instead gave the relieving letter without any fuss.
I would request all employees who would like to break their bonds to not pay the bond amount but ask for the exact expenses incurred by the company and pay that amount to get the relieving letter.
Regards,
Dr. TSG
From India, Madras
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Service Bond Issues and Legal Notices
I am from Kerala and find myself in a similar situation. I was part of L&T until November 2011 and faced the same problem. I breached the service bond because I was denied certain benefits and received rather harsh treatment from the authorities. L&T sent me a legal notice mentioning a 2 lakh bond money with 18% interest to be paid.
Clarification on "List of Expenses"
The point you explained as "list of expenses" is vague to me. What if the company produces a fake list of expenses? Can you elaborate on that? Also, please elaborate on the type of expenses which bond money can contain. For instance, expenses can be due to travel, accommodation, etc. Will those be included in the bond amount?
Looking forward to hearing from you.
Thanks and regards,
Amenon.
From India, Ghaziabad
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1I am from Kerala and find myself in a similar situation. I was part of L&T until November 2011 and faced the same problem. I breached the service bond because I was denied certain benefits and received rather harsh treatment from the authorities. L&T sent me a legal notice mentioning a 2 lakh bond money with 18% interest to be paid.
Clarification on "List of Expenses"
The point you explained as "list of expenses" is vague to me. What if the company produces a fake list of expenses? Can you elaborate on that? Also, please elaborate on the type of expenses which bond money can contain. For instance, expenses can be due to travel, accommodation, etc. Will those be included in the bond amount?
Looking forward to hearing from you.
Thanks and regards,
Amenon.
From India, Ghaziabad
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How many months did you serve with the company? Companies like L&T will not provide anything fake. They will have to give you a breakdown of all the expenses incurred, such as external software training, travel expenses, accommodation, etc. In any case, it is highly unlikely that this would be 2 lakh. If you have served a considerable amount of time (1 year+), you can get a significant reduction in the bond amount. You may only need to pay what others pay when they leave after their notice period (2 months' salary or less).
Please do not leave the company until you have sorted all of this. Do not abscond, as that is when they can send a notice. If you stay with the company until all is negotiated, they cannot send you any legal notice.
Regards
From India, Madras
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Please do not leave the company until you have sorted all of this. Do not abscond, as that is when they can send a notice. If you stay with the company until all is negotiated, they cannot send you any legal notice.
Regards
From India, Madras
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I am already out of the company. To be frank, I have been absconding since last November. I served in the company for 16 months (June 2010-November 2011). I had training for the initial 8 months. We dealt with nothing. We had a couple of trips, the total expense of which would never be more than 50 thousand. Moreover, I haven't received LTA which amounts to 23,000 Rs (which is a part of the salary). I was supposed to receive this when I completed a one-year term. I was denied that too. I have already received the legal notice. I am all set to reply to them. Would it be advisable if I claim for the list of expenses and relieving paper?
Kindly clarify.
Thanks and regards,
Amenon.
From India, Ghaziabad
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Kindly clarify.
Thanks and regards,
Amenon.
From India, Ghaziabad
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I am facing a similar situation. I joined L&T Infotech 4 months ago as a fresher and signed a similar bond of Rs 2 lakhs for 2 years. I want to leave the company now. What is the best way forward? Please suggest.
Regarding the expenses incurred, did you send them a legal notice asking them to list out the expenses incurred, or was it over email?
Regards
From India, Delhi
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Regarding the expenses incurred, did you send them a legal notice asking them to list out the expenses incurred, or was it over email?
Regards
From India, Delhi
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I joined a company with a 2-year, 2 lakh bond. I was with the company for 33 days and was a very good performer among my peers. However, the environment created mental stress for me, affecting my performance and making me unhappy about continuing to work there. Consequently, I decided to leave the company on the 34th day, with 43 days of training still remaining. Ten days after my departure, they sent me my resignation. Now, six months later, they are asking me for the 2 lakh bond amount. What consequences might arise from this situation?
From India, Bangalore
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From India, Bangalore
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(Fact Checked)-The company cannot demand the bond amount if you worked for only 33 days. They can only ask for expenses incurred during your training. Seek legal advice if needed. (1 Acknowledge point)
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Hello Dr. TSG,
I am in a similar situation as your client, and with the same company. Could you please tell me what exactly has to be asked for, and if it has to be sent in the form of a legal notice or just a mail to the HR?
In desperate need of your help.
From India, Mumbai
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I am in a similar situation as your client, and with the same company. Could you please tell me what exactly has to be asked for, and if it has to be sent in the form of a legal notice or just a mail to the HR?
In desperate need of your help.
From India, Mumbai
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(Fact Checked)-The expenses incurred during training should be requested from the company in writing, which can be done through an email or a legal notice for formal documentation. This ensures transparency and compliance with legal procedures. (1 Acknowledge point)
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Yes sir, please guide I have joined a week ago and got a new offer so want to leave l&t ecc.please guide about the service bond thing
From India, Pune
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From India, Pune
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Hello Sir,
I am working with L&T Infotech. It's been 1 year and 2 months. I have a bond period of two years, and if I leave before that, I have to pay 2 lakhs. I want to leave the company. What can be done so that I don't have to pay 2 lakhs? I am ready to pay 2 months' salary. Please help with this.
From India, Bengaluru
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I am working with L&T Infotech. It's been 1 year and 2 months. I have a bond period of two years, and if I leave before that, I have to pay 2 lakhs. I want to leave the company. What can be done so that I don't have to pay 2 lakhs? I am ready to pay 2 months' salary. Please help with this.
From India, Bengaluru
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BOND BY AN EMPLOYEE FOR NOT ENGAGING HIMSELF.doc
CiteHR.AI
(Fact Checked)-The explanation provided by the user regarding the list of expenses and the potential for a company to produce a fake list is accurate. Expenses incurred during training, travel, accommodation, etc., can be included in the bond amount. It's essential for the company to provide a genuine, itemized list of expenses to the employee. It is advisable for individuals in similar situations to seek clarity on the expenses incurred to ensure transparency and fairness. (1 Acknowledge point)