How to Handle a Non-Compete Clause Given After Joining: Seeking Advice and Options

I joined the company on 6th Feb 2015, an old reputable company with around 3000 crore turnover and 1000 crore profit. I was not given an appointment letter and was told I would receive it at the time of joining. Upon joining, they provided me with an appointment letter that included a non-compete agreement as follows:

Non-Compete Agreement Clause

In order to protect the company's confidential and proprietary information, to which I shall have access, especially at my level of seniority, I agree and confirm that for a period of two years from the date of termination or cessation of my employment agreement, I shall not, without the written permission of the Company, engage myself in any company, firm, or concern, and/or be concerned in, and/or set up or abet the setting up of, any business, profession, or avocation which is similar to and/or directly or indirectly competes with the business of the company and/or any of its associated companies and/or firms.

Incidentally, I have been in the same line of business for 16 years (total 19 years of experience) as the company's value proposition (they have been in this for 6 years), and this clause does not help me because I am getting a similar assignment.

Discussion with HR Manager

I informed the HR Manager that the above clause is very open-ended, and Indian courts do not deem it valid. He agreed but mentioned that this is a standard practice for all employees, from junior to senior, and he cannot alter it for one individual.

Options and Legal Considerations

What are my options if the company insists on the non-compete agreement signing? Can I claim damages for the inconvenience and uncertainty caused by their failure to provide such information in advance? What can I claim?

Indian society provides Patent, Confederation of Indian Industry, and NASSCOM to influence government policy. Why do they include these clauses that are not valid in court and cause trouble for people?

Please guide.

Rolta Industries Limited: Employee Concerns

Rolta Industries Limited is a fraudulent company. It traps its employees like anything. It does not provide an appointment letter beforehand; instead, it gives it only on the date of joining, which contains a very loosely worded 2-year non-compete clause. Even HR agrees that it is not valid in court.

Business Practices and Intellectual Property Claims

The company develops its products by intentionally bidding low in all its lines of business, such as Defence, Battlefield Management System, OneView, or Oracle ERP, and then converts them into products, claiming them as intellectual property.

Leadership and Reputation

K K Singh, CMD of the company, is the son of a doctor who, on his mother's advice, chose engineering over the family's cyclic steel plant business in Indore. After moving to Mumbai, he has gained a reputation for appropriating the knowledge of clients and industry defense leaders, converting it into so-called intellectual property, and selling it.

HR Practices and Employee Challenges

Rolta Industries has some of the worst HR practices, putting new joiners in a difficult situation.

Without commenting on anything else, by adding a new non-compete clause, which is contrary to Section 27 of the Contract Act and thus void, the company has virtually rescinded its earlier offer of appointment. You may repudiate the agreement, and you may sue the company for damages in terms of the apex court decision in Kasturi Lal v Union of India, decided in 1959.

Thanks,

Sushil