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Hi Friends,
I am working with a South Indian Hotel company as a Management Trainee. I have already completed 23 months of training (out of 24 months). I resigned on may 18, 2015 and they accepted my resignation on 6 June 2015. They dont want me to serve notice period also. Now according to company policy i have to pay my remaining 1 month stipend i.e. Rs. 16000/- but the company is asking me to pay 6 months stipend i.e. Rs. 96000/-on the basis that 1 month is remaining and after 2 more months there will be evaluation of training program. If there will be any 6 months extension to that then i have to pay 6 months stipend.
Is it legal? I am resigning 1 months before my training finishes and 3 months before the evaluation. Do i have to pay six months salary too??
Its like paying nearly 1 Lakhs rupees to get reliving letters.
Kindly guide me through this.

From India, Hyderabad

Hi Will,
You need to carefully read the appointment letter or the joining letter and see if there is any such clause mentioned in the letter.
If there is something mentioned like what you have written it is advisable to extend your stipend period and serve the notice period.

From India, Delhi

Hi Will,

After the training finishes in June-2015, & if evaluation is in Aug-2015, then where is the account for these two months? Were you expected to work there for these two months without contract?

If you are resigning, then how is the 'possible extension of training' applicable? Why would they want to extend your contract "to train you more", if you have failed in the first evaluation & want to leave??

They can mention that the training is not completed satisfactorily, but cannot force you to remain in training. Also, they cannot refuse to provide relieving letter (Just like, a school leaving certificate).

Secondly, this is "stipend" (Stipend is monitory allowance for a role that is normally unpaid & which cannot be measured in terms of a task) & not the "salary" (Salary represents payment for work performed by availing your services for a defined task). You should not be legally asked to pay back the stipend for one month either....

I personally think that, this is just another scheme from an unethical management, to harrass trainees just because they have control over it... Somebody should really drag them to court & make them pay for such bullshit rules.

Though, I am not sure if the labour laws would apply to your case, as you were considered as a student & not an employee.

Also as Nathrao correctly said, our legal practices are generally lenghty & expensive. This is a very good topic to get views from our legal expert seniors.

I am curious to read further suggestions as well...

Best Regards,

Amod Bobade.

Thank you so much everyone for help, I would also like to add up this point that till now I have not been given any offer letter neither I have signed any. The only papers which I have signed were those of esic and pf. I only have letter of intent. I am joining a new tech company from next week and I dunno what to tell them coz I still have to wait for reliving letter and that will cost me too much. I'm really worried seems like end of my career so soon.
From India, Hyderabad
Dear Amod,
This training officially ends on July 18th however I resigned on may 18th. After training ends the company takes normally 2 months time to evaluate the training period for further promotion and in those 2 months they expect us to work as management trainees. I am not getting 1 thing... if I am resigning right now then why would they evaluate me further to pay them back coz evaluation time is still 3 months far and it's undecided unknown that will I be promoted or I will be extended for further 6 months training. They say it's company policy but I have never seen this policy on papers during my 22 months training period neither I have signed offer letter till now so is their so called "policy" applicable on me??
Shall I tell the new company about this and will they accept me after knowing the fact. It's my first job change. To be precise this new company is international tech company.
Kindly help me.

From India, Hyderabad

As mentioned by Amod & Nathrao, Training is teaching, or developing in oneself or others, any skills and knowledge that relate to specific useful competencies, and Stipend is paid not for the work performed but is paid as living wage. The company cannot claim the Stipend as Notice Period buyback, it is illegal and can be challenged in the court of law. You can persuade them firmly to relieve you amicably.
From India, Ahmadabad

Hi Will,

If the "Management trainee" program continues till evaluation, then officially the training period does not end in one month, but in 3 months (4 months, if you have resigned in May!). By resigning, you wish to leave the training before completing. The evaluation is still necessary as the employer has trained you for 22 months, even though it might say you have not completed the training as expected.

From your response above, it seems you do not want to continue any further connection to this organization or the training received from them. Please do not devaluate the training you have received till date from them.

This is as well an issue of ignorance from your end, as much as from employer HR. We should not take the organisations for granted. You should have asked timely questions & got the policies clear about your employment, than to run away from them now. It is your experience/training certificate, which is at stake here....

You say you have not got any offer letter... So how do you accept the stipend? Just based on verbal discussion? Is there no letter/office memo indicating 'you will get stipend of xxx amount for xxx period'? Are you even getting pay slips for the stipend?

If you do not have appointment/offer letter, then you might not really expect to get a "experience / relieving letter". In that case there is no point in paying the stipend amount to the hotel. What you should pursue is for best possible F&F settlement & a clearance/handover note before leaving.

Yes..... you should inform the new company, about this "basis of employment" with your current employer, so you would not get into any trouble, if they insist for any further documentation about your previous experience.

Are they already aware that you are leaving the training in half before evaluation?

Since you were just in 'management trainee' position before, I do not think the new employer would really expect it to be a real "experience".... They should understand if you are not able to produce certain documentation, but have declared it upfront.

Finally, do not be worried that your career is at end so easily.... Worst case would be that you would lose these 22 months of experience on paper & would have to start job hunt as fresher again. That's not so bad, as 2 years of learning is not too much in the whole upcoming career of about 40 years.... Anyway, the experience you gained (even without certificate) will be with your life forever. Nobody can deny that....

Hope for the best, but prepare for the worst!

Best of luck!

Best Regards,


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