Facing Legal Notice Over Employment Bond: How Should I Handle This Situation?

Sir,

I was working in a firm in Indore. I joined that firm in the post of deputy manager with 3 years of experience. The previous employer created such a condition that I was asked to sign a bond for three years. I was deputed to Bangalore with a commitment that they would bring me back to Delhi, which I signed.

I was working peacefully, but suddenly, due to a recession, there was extreme pressure from my office, which was unbearable. I even got other offers, but I denied them. Now, three months back, I received an offer that I consider my lifetime achievement, a result of all my hard work. I informed my reporting boss and the president of that company. The president agreed but asked me to work for two more months, so 30-04-09 was my last date in that company, as confirmed in writing. Although I did not receive any salary for the last two months, I completed that period and happily joined the new firm. Since November 2008, all my travel-related bills (approximately Rs. 55,000) have been held. Now, they have sent a legal notice to my house demanding six months' salary or legal action.

Please suggest what to do. I was expecting my full settlement, but instead, they are demanding payment. I also sent the resignation to the HR head and all concerned persons, but I have not received any reply from them regarding the bond (as I was not given any copy of it). Additionally, in my offer letter, there is a clause stating that I will be on probation until I receive written confirmation from HR, which I have not received to date.

Please suggest what to do regarding the notice from HR.

I joined as a deputy manager with 3 years of experience. I had relevant experience in that field. They only conducted a 15-day induction program to familiarize me with all the personnel at the plant and head office (no special training where they have invested anything). As per the offer letter, the training period is one month, and the probation is 6 months (which can be extended as per their offer). There is a 3-year service bond.

Boss, I am really tense, although I informed all the concerned parties via email, and they agreed to allow me to go out (an email from the company president). Even if they had raised the issue of the bond earlier, I would not have left. Please suggest. Your reply is awaited.

I was also asked to engage in some illegal activities in my area (I have relevant proofs regarding government issues). If possible, please provide a contact number.

- Deepak

Dear Mr. Deepak Singh,

Without going into details, I have one doubt: you received written communication from your Firm stating that 30th April 2009 was your last day, and you worked for two months without salary. In that case, where does the question of a Legal Notice arise? Based on the basic information you provided, I believe you will not encounter any problems. However, if you still feel uncertain, you can consult an Advocate whom you know well (from your circle of friends).

Once an Organization issues written communication that 30th April 2009 was your last day - as per the information you provided - a Legal Notice would not serve any purpose.

I seek opinions from experts to guide the gentleman who is confused, please.

Sundararaman

Thank you, Mr. Sundar.

I was surprised when they sent a letter to my mother demanding six months' salary. Actually, I resigned on the 10th of February 09, requesting my president to relieve me by the 31st of March. They asked me to serve until the 30th of April. The reason given by management was that they would hire someone in my place to whom I could hand over the responsibilities. Even our Head of HR department came, we conducted interviews here, and hired a total of 4 persons for the Bangalore Branch - three juniors and one to fill my position. Later, we had a good party as well.

Sir, I don't understand what to do. I talked to my HR, who didn't say a single word about that bond until I moved out (30-04-09). Two days back, I called him and asked for a solution. He is suggesting to demand that money from your new company and deposit it to them.

Deepak

Employment bonds are a sheer waste of stationery and time. There is no legal validity provided to such bonds by any act.

Write back to them demanding your valid dues with a warning that if they do not settle your dues, you may take this matter up legally. Don't worry, you will surely win this battle hands down.

Good luck.

As far as bonds are concerned, they can't be challenged by any company. According to our constitutional provisions, no company can impede the progress of an employee by requiring them to sign a legal bond. Companies may only exert psychological pressure on employees, which holds no legal validity.

Please let me know if you need any further assistance.

In my view, you should contact a legal person (labor or consumer court) and send them a letter demanding your balance payments (2-month salary and travel allowances) with all proofs.

As far as bonds are concerned, it is a sheer wastage of stationery and time. As per our constitutional provision, no employer can halt the progress of any employee. Bonds are only meant to put psychological pressure on the employees. No employer can challenge it in any court; it is only a psychological tactic.

Hi,

Just do not worry. As the other gentleman suggested, write a detailed letter attaching their letter asking you to stay up to 30th April 2009, and also quote the party you had, etc. Send it by Registered Post Acknowledgement Due (which no company return - don't send by courier service as there is a possibility of your letter getting returned).

For your ready reference, I am giving below which has been taken from this Cite HR. Please be bold and get into action.

---------------------------- Quote --------------------
Validity of Bond/Service agreement, on company's letterhead, as per Indian Stamp Act
In India, Bond is illegal as follows:

As per the Indian Statute, the bonded labor system was long abolished, and no bond can force any person to work against the employee's wishes.

Article 19 of the Indian Constitution talks of fundamental rights. As per Article 19 of the Constitution, the right to work is a fundamental right, and under no circumstance does the Fundamental rights under Article 19 be waived by any person, nor can any person be forced to do something that amounts to the violation of the rights mentioned under Article 19.

As per the Indian Contract Act, contracts entered between two parties, if one-sided, would be null and void. Most of the Bonds are one-sided.

Again, as per the Indian Contract Act, no contract can be enforced on any person if the contract being enforced causes any harm to the person on whom it is enforced and if performed would violate principles of natural justices.

As per Sec 368 of the Indian Penal Code, if any person or institute holds back any document or uses any legal document, or threatens any legal suits or actions and thus forces a person to perform any act against his wishes or which is illegal or wrong as per the statute of Law of the land.

Sec 368 of the Indian Penal Code talks about extortion by threatening to file a legal suit. The minimum punishment under this act is two years.

The Supreme Court of India has clearly stated that no employee can be forcefully employed against his will just because he has signed a contract with the employer.

The court has also stated that the employer cannot hold back any personal document of the employees as they are earned by the employees, and the company has no claim on the same.

Any complaint against the company would land the Directors and Managing Directors of the company in Jail, as the company is not an actual living entity but a legal entity, and the management are hands and heads of the company.

Bonds are applicable only if the company has spent money on the personal grooming and enhancement of the employees, but not just training that helps employees perform better.