Can We Withhold Relieving Documents if an Employee Refuses to Pay Dues?

I work in an MNC. One of our employees resigned while working at a client site. As per the deputation agreement signed at the beginning of the assignment, the employee is expected to serve at least 6 months in the organization once the assignment ends, and if he/she resigns before the end of the assignment, the employee has to repay the cost of deputation to the organization.

The employee has served the complete notice period. We need him to extend his notice period by a week due to some urgent deliverables, but he is refusing to do so. He is also not ready to pay the money he owes due to not completing his assignment.

Can we withhold his relieving document in such a situation, citing non-payment of dues?

Strictly speaking, you can't. However, there are a few aspects of the case that don't seem well thought-out.

Usually, most companies have the notice period as 2 or 3 months, while in your case it's 6 months. Despite this, the employee served it fully. Couldn't the company find this time sufficient to plan for knowledge transfer—to assign someone to take over the project from this employee, knowing full well that he will not be available again?

Handling the Situation

I think the best approach would be to cajole or request this employee to complete the pending work. If necessary, someone from the company could speak to his next employer to assure them that he will be relieved in another week. This might sound preposterous, but there are companies that do this to ensure a win-win situation for everyone involved, including the added bonus for the company of the employee leaving with happy memories of his tenure.

However, if you want to go the unethical route, any organization—given their relatively higher clout compared to the employee's—can do whatever they wish, including, as you mentioned, withholding the relieving documents.

The choice, ultimately, is yours. However, every choice has its own set of consequences.

Regards,
TS

Thank you for your reply. I would like to clarify. The organization has a notice period of 3 months. The six months I am referring to is a mandatory period that an employee must serve at the end of an onsite assignment in order to have an effective KT. Also, as I stated, if the employee resigns during the onsite (read overseas) assignment, we recover the cost of travel and accommodation as this is an additional cost borne by the company for replacing the employee who has traveled overseas. In my case, the resigned employee has served the notice period of 3 months but has refused to pay the amount for having resigned mid-assignment. Hence my question.