Saswatabanerjee
Partner - Risk Management
Skhadir
Strategic Business Management Includes Revenue
Cite Contribution
Community Manager
Tajsateesh
Recruitment/talent Acquisition, Career Counselling
Raj Kumar Hansdah
Shrm, Od, Hrd, Pms
Employment Lawyer
Lawyer & Consultant
Kanika Kapoor
Soft And Behavioural Skills Trainer
Bksharma
Turnaround And Management Training

Dear Sir: I am employed in a multinational company and upon joining they signed us an indemnity bond worth rupees 5.5million. The terms on the bond were. The company will try to arrange training for two years (may it be more or less) and after certification (which means completely trained) i have to work for the three years more. It\'s been passed two and half years the training isn\'t still completed is not likely to be completed in the next few years. During this time we are mostly sitting idle in the office that means doing almost nothing. This is really dire situation for me as I was not aware of this before signing the agreement. While company is trying to complete our training they are mostly failing to do so as well and my pay is not updated (currently this is very low comparing my other colleagues in the same job) as they say I am non productive at the moment. The dilemma is I can\'t be productive before completing my training and while on the other side they are failing to arr
17th April 2013 From Pakistan, Karachi
Dear Mudassir,
Please refer to the following link.
Hope it helps!
Free legal advice India
Regards,
Kanika Kapoor
18th April 2013 From India, Delhi
Hi Kanika:
Do you know any situation when an employee broke down the indemnity bond and is still safe. I don't want to break this indemnity bond personally but on the other side I have to ruin my career. Please help with the legal advise, it will be really appreciable. The link isn't working
Thanks,
Muddasir Masood
19th April 2013 From Pakistan, Karachi
Dear Muddasir,
Which nation does this firm belongs to and where was the Bond signed? The laws of the land will remain valid. This firm seems to be either an NBFC or software. Sectoral laws would remain a point of reference.
I am mailing this to a corporate legal expert in India, lets get connected to someone from the nation, where you signed your bond.
19th April 2013 From India, Mumbai
It would be necessary for you to upload the document / bond to analyse its legality. You can block certain personal info / company name etc, in case you are not comfortable disclosing it on the forum.
19th April 2013 From India, Chennai
Dear Muddasir,
I second Z.N.Hansi, please share the details to the case. The leader I wrote to , asked for case details. Please remove the name of the company and names of the people , to maintain the privacy .
Looking forward to hear from you .
19th April 2013 From India, Mumbai
Without seeing your bond, it is difficult to say
In addition, most of the members here are from india, and the laws here would differ from Pakistan.
However, our laws are derived from British and share a common heritage, so chances are that contract and torts will be same as ours.
They have promised you training and taken an indemnity bond to defray the cost of the same.
However, the training was not provided. So since the condition which is the central consideration for the contract is not fulfilled, the contract and bond is void ab initio. Meaning you are not bound by it. You can resign and leave. I doubt if any court of law will force the employee to follow the terms of a bond when the employer has not done his part.
20th April 2013 From India, Mumbai
I agree with the general observations of Saswat, as given above.
This is a one-sided bond, unfair and oppressive'moreover the company has not even fulfilled its side of the bargain. The prospective employees are forced to sign such bonds under financial duress and not out of their free will.
The penalties are not commensurate with the benefits offered.
In my opinion; such bonds will not stand the scrutiny of the courts of any developed, democratic country.
Warm regards.
20th April 2013 From India, Delhi
Dear All:

Thanks for your valuable comments.

@ Z. N. Hans and (Cite Contribution), I am attaching this agreement here for your reference and support, will be really appreciable, thanks for your comments too.

@ Raj Kumar and Saswat: They sent me for the training, but the bond is tied to certification, and this certification requires extensive training to be done by me, but my employer has failed to provide me in due course of time (two years as mentioned in the bond, but they included the term "be it more or less" to keep them safe), it's not in the mid-way. They told us that we will be extensively and continuously deployed on to many projects to learn before getting certification, but they hadn't done so for, which means we received one training after sitting idle for six months and then afterward second onsite training which is project based was done after almost one year and we don't know how long we may be waiting for the next project-six months have been passed up to now.

I have also attached the agreement for your reference and will be looking your kind advise on it. From my perception, this bond is greatly biased on the employer side. We hadn't noticed this at the time of signing and moreover we aren't in the position to negotiate, either sign or leave.

Regards,

Muddasir Masood.
21st April 2013 From Pakistan, Karachi

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Dear All: I am still waiting for your valuable comments! Please advise me on how to get rid of this agreement? Regards, Muddasir Masood.
25th April 2013 From Pakistan, Karachi
I have gone through the scanned files.

You will need to take the help of a lawyer who knows Pakistani laws on what is the actual method to be followed.

Assuming Pakistan laws are similar to india since we both adopted British jurisprudence, the following points are important :

- rs. 5.5 million is high. The actual training cost can not be that much

- the period 2 years training and 3 years work after that is too long.

- if the company failed to provide proper training and delayed the same for whatever reason, the bond will get invalidated. YOu should be able to give notice of termination.

- the agreement can also be invalidated as being given without application of free mind on account of undue Influency and false promise (of training and work experience)

Generally labour courts will not allow a company to bind an employee to doing work under circumstances that affects the career and future earning potential of the employee. These principal of jurisprudence is the basic of labour protection law as the employee is working always to enhance his own future earnings and also that employee rarely has bargaining power.

You need to find another job quickly. Thereafter, give notice of termination of the bond and resignation. But have a lawyer prepare a strong termination notice. If you have given a cheque to them, ask the bank to cancel that cheque (stop payment order)
27th April 2013 From India, Mumbai
After going through the indemnity bond, and considering the Contract Act is similar to what we have here in India, there are judgements passed by our Supreme Court that one sided unreasonable contract / bond like this is not sustainable and in violation of the Contract Act. The bond is illegal if it was under Indian laws. The bonded duration of work and the liquidated damages are excessive and on the other hand the company cannot just recover the money from you just because it is accepted under the bond and that the company needs to justify how and why it is entitled to the said amount before the court. Further the contract / bond is completely one sided, ambiguous and has no reciprocal clauses towards specific performance of contract. You will need to do your research on such judgements and I am sure you will have many there as well, and then take an informed decision after consulting the Lawyer at your place.
27th April 2013 From India, Chennai
Dear All
I fully agree with the opinion given by Employment Lawyer.
In fact, I have held this view earlier as reflected in my earlier post.
Such one-sided agreements (bonds), with no quid-pro-quo are purely intimidatory in nature; and would not find favour in any court of justice.
Moreover, in these days of "hire and fire", as conscientious HRs we should discourage such bonds, which are exploitative in nature.
Warm regards.
27th April 2013 From India, Delhi
Thank you so much for your valuable comments. Let me try to explain this complete story of my agreement and work thereafter with this company.

We had been told that we need to work for the company for a period of three years after getting training, which we hadn't bothered initially as they promised us that the training will have great development and full international exposure and that we will be continuously working on to different projects that benefits both the company and us. At the time of signing this agreement, we raised our concerns such as on the excessive amount mentioned in the contract and that of "company reserve the rights to terminate training and the loss in this case has to been compensated by us", but the company told that this is just the formality to let our training approved from the higher management. After nine months (this was only sitting time) of signing this agreement we were sent for the training, the cost of which as they told us was around 21000Euro, and four months after this training I am appointed for a different task "HSE Manager" (this task was critical and I have no experience in this and this is also nothing to do with my agreement or my job, they had to hire an expat for it and they instead selected me to save huge cost that could have incurred). I diligently worked and successfully completed it not to mention that I have no prior experience. After five months of this task they sent us to a project-duration of only two weeks. And now it's been six months again, we are sitting idle hoping for any new project to come.

The point here is the period between training and project was just spent sitting idle doing nothing and this has greatly diminished my potential development that I could have attained even in an average opportunity. The worse is when I expressed this concern to my manager, he simply refused it as being over-demanding and unreasonable and repeatedly doing this, he had even pressed on me and getting in to an egoistic mode now.

I have now a new opportunity and I really like to take this head on and I am worried about this agreement.

Thanks for your comments again, I explained the above situation so that in view of this you are now able to better advise me.
29th April 2013 From Pakistan, Karachi
I think my comments still hold true after your clarification.
I would suggest you also make the matter clear to your prospective employer and take his consent. It should not be that you are terminated later on account of having suppressed details of this incident.
I think you can safely break the bond
Have the bank put a stop payment on your cheque given to the company
Give a legal notice to the company
Speak to a lawyer first as this could get ugly
29th April 2013 From India, Mumbai
I haven't heard about any training that cost PAKISTAN RUPEES 55,00,000 or 5,500,000 covered in 2years. I don't think so company might have hired you alone for this kind of training. Let me know if anyone else is getting trained along with you.

The point to be noted is that, as per your bond training is scheduled for 2years or less but, it had crossed its scheduled duration. By the end of the two years post training, you were suppose to be periodically assessed and evaluated while you were given as task to perform. If this is not happening, as per your bond, you do have right to initiate primary talks with your HR to understand the legal issues from the company point of view. If you find something fishhy, you must consult legal consultant(lawer).

Nothing can be ONE SIDED and companies have no right to take undue advantage of their employees by signing such bonds. Every problem has a solution. All you need to perceive it in the right sense by applying logic and do consult legal experts before you take any decision.

With profound regards
29th April 2013 From India, Chennai
Abdul Khadir, that is true we are 25 person signing the same bond and most of them are really unhappy about this. It is also true that two years have been lapsed now and my training isn't finished yet but if you see in the agreement the company has used the term "be it more or less" to keep them safe.
29th April 2013 From Pakistan, Karachi
Dear Muddasir.masood, Assalaamu Alaikum w/r w/b,

Let me quote in this way. I am sure only a TRUE MUSLIM PRACTING ISLAM can understand my views.

If you are a true believer of ALLAH (swt), had surrendered your will to ALLAH (swt), If you are a muslim by practicing islaam, if you truly beleive whatever is happening is according to his(Allah swt) will and wish, then, you pray 2 RAKATH NAFIL and seek his guidance and help. I am sure based on your GOOD DEED(AAMAAL), you will receive his guidance and no-doubt it. Its all associate with your E-MAAN and YAKEEN(BELIEF).

If you are honest, sincere and loyal personality, you must thank ALLAH (swt) for everything as he blessed you with bread and butter till date through(zaria) your current company. You were still paid when you had no work to do. Ups and downs are part of our life and we must experience happiness and sorrow to understand the ground reality.

If you want to live a peaceful life, please do not COMPLAIN, CRITICISE and COMPARE. If your friends are doing good or earning good, that means whatever is written in their fate, they are receiving it and you will receive whatever is written in your fate. If you run after the success which is not written in your fate, you will face defeat and will lose whatever you are blessed with. Henceforth, respect and value your current status.

You need to justify with yourself and your employer for whatsoever knowledge you had acquired through them and whatsoever good things happend till date. Think practically about the loss you had incurred through your current employer. If you think you had incurred loss, please submit your resignation and state all valid reasons for breaking your indemnity bond. By the grace of ALLAH (swt) grab the opportunity you have in your hand. If it is in your fate, it will be yours and your employer will relieve you. Don't forget to have open discussion with your future employer about your current scenario.

Learn to secure from ALLAH swt through your prayers and good deeds.

Hope you understood my message.

JAZAKALLAH KHAIR


30th April 2013 From India, Chennai
Dear Muddasir,
As advised by Raj Kumar Hansdah, this bond is junk, carry no legal tender. Write to your management to free you of bond as they fail to provide you with training. You will get NO response. You may break the terms of bond after reasonable period of time as you think fit.
Incidentally many of bonds are just junk. They are mostly relevant to the extent that IP of the company is concerned and in some cases joining competition. For the rest bonds are just scarecrow. have fun and stop worrying.
2nd May 2013 From India, Chandigarh
Well, the term be it more or less is to be seen in the light of the entire document.

It is not a condition that can be used to make the employee a bonded slave (albit paid one) of the employee. (Assuming pakistani courts follow the same jurisprudence as indian courts), It is most likely that the courts will read the line in a very narrow meaning :

if the training is taking longer than originally intended because the understanding levels are at lower levels, than the period is extended. Where the course is completed much sooner then the period gets reduced and the next period of 3 years starts immediately thereafter.

However, it needs to be for conditions beyond the control of the company and within reasonable period. Failure to get projects to work on and complete certification is not a scenario that can be used to extend the training period. It should have been taken into account in the planning and it is the domain expertise that the company should have had in the first place. Further in this case, the reasonableness seem to have long expired.


3rd May 2013 From India, Mumbai
Dear All:
Thank you so much for the valuable comments. They were much needed and have been understood at the most.
Being fair and honest, I have talked to my manager and discussed with him the complete situation about my past and present and requested him to accept resignation and terminate the bond in both of our favours. He has asked for a one week time. I am praying that everything goes fine. Please pray for me. I am trying to bridge between slavary and freedom and that is only by doing right things with pure conscience.
Please pray for me.
Regards,
Muddasir Masood.
6th May 2013 From Pakistan, Karachi
Hello Muddasir Masood,
Hope all goes well.
Suggest keep this Forum informed of the developments next week when your Manager is expected to arrive @ a decision--it could be a learning for many members.
However, I also suggest you begin contacting a suitable Lawyer to prepare for any Worst-case-scenario that MIGHT emerge. Like the Saying goes: Work towards getting the Best, but also Prepare for the Worst.
IF your manager's decision is negative, then you may not have a lot of time to put-in the alternate plans-of-action into place. In case your manager responds positively, then you wouldn't be loosing anything much--except some time & effort.
All the Best.
Rgds,
TS
8th May 2013 From India, Hyderabad
Dear All:

Thanks for your valuable comments once again. There is a further progress to this case.

As I have told you, I had resigned from that company 6months ago. Below was my resignation letter to the superior

Dear Sir:

I am writing to inform you that I am resigning from my position as Electrical Commissioning and Fact finding Engineer.

I have been through from many ups and downs all with your support and mentor during this period and I shall be thankful to you for that. I have decided that it's time to move on as we are facing serious delays in projects causing loss to both of us, a threat to career progression in my case. Other than this I have enjoyed every given opportunity and worked responsibly towards achieving a common goal. I wish you and the company great fortune and will be available in the future on any objective need.

Please be assured that I have left all the company belongings in my cabinet for you to collect.

I once again thank you for having me as the part of your team.

Sincerely,

Muddasir Masood

Two days ago, I have received the notice from that company asking for 5.5million PKR with in 14days in liu of breaching my agreement and failure to do so will be called upon for legal proceedings against me.

I might have told you that before my resignation, I have come across several meetings with my manager and he assured me that I can leave the company and it will not go for legal proceedings against me as I have every right to take on my career to next steps. All it will do is deduct the cost from my dues and won't issue me an experience certificate which I had agreed.

I seek your valuable comments on how to proceed from there.

Thanks in anticipation.

Sincerely,

Muddasir Masood.
22nd December 2013 From Pakistan, Karachi
You need to get a lawyer to help you respond to this.
Ensure you dwell on the fact of undue delay in project and therefore your contract period,me hick invalidates the contract (you need knowledge of Pakistani tort jurisprudence, which I am not well versed with) and the fact that a contract which has the the unintended result of career damage is not enforceable. For that, refer to contract act (Pakistan and india has the same contract act of 1881) which refers to offer and acceptance, with both parties intending the same thing. Here, where what you intended and agreed to, is different from what has happened, so the contract is now invalid.
22nd December 2013 From India, Mumbai
Having read that notice my mother an already patient of diabetics has gone much worse and had been hospitalized which according to doctors a little delay would have taken her in to Coma. The language of notice is very strong and quite threatening (I have attached the notice here). I couldn't believe a company of high repute could go such mean way. I am trying to arrange information to response to this notice.
22nd December 2013 From Pakistan, Karachi

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The letters are standard wording.
All lawyers write letters that way
You speak to your lawyer and send a reply
Meanwhile your dad can send a reply saying that he is not liable to pay as the bond has been invalidated both by their prior behaviour and by consent of the concerned manager action on behalf of the company. Further that this amounts to harassment and that he will take necessary legal action against the company.
Your lawyer will decide the next step
22nd December 2013 From India, Mumbai
The very fact that the bond amount is ARBITRARY and EXORBITANT makes it unfair.
Moreover, whether you were ACTUALLY given any training; or what would be its fair worth; also needs to be taken into consideration.
The best solution at this stage would be consult a good lawyer.
Warm regards.
23rd December 2013 From India, Delhi
@Muddasir masood, I am from Pakistan and someone close to me is in a very similar situation, can you kindly update on the matter that what actually happened????
5th September 2018 From Pakistan, Karachi
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