Facing a Surprise Liquidation Fee: How Should I Handle My Job Offer Dilemma?

Dear all,

I joined a company, and at the time of joining, the company told me that there is no bond. Now, I have received an offer from another company, but my current company is asking for a liquidation amount as per the terms and conditions in the service agreement. The clause is attached here for your reference.

Please suggest how to handle this situation.

The conditions of training seem to have been couched in very vague terms. How long were you trained by the company? Were you paid any stipend or the regular salary during the training period?

Besides that, in the event of the present company refusing to accept your resignation or holding your relieving letter and experience certificate, will your prospective employer allow you to join?

Dear sir,

I joined the company as a full-time fresher, and the training period is for 1 year as per the service agreement. After that, I will be confirmed as a permanent employee of the company, and they will pay me a salary. Now, after 18 months from my joining, I have received another job offer.

The prospective employer is requesting a relieving letter. I am seeking advice on how to handle this situation as I do not have enough money to make any payments.

Thank you.

Yes, the terms and conditions are vague and impossible to be enforced through the due process. However, the liability could be held out as a bargaining chip for getting the relieving letter.

Dear member, already, the learned members have given their views. Nevertheless, we need to know the following:

a) What was the duration of the training in terms of days, weeks, or months? How many hours were spent per day in the training?

b) How was the attendance for the training recorded?

c) What kind of training material was issued to you? Did your company obtain your signature for the issuance of the training material? Did the training department or any other agency conduct a test upon completion of the training?

d) Did the company issue any certificate upon completion of the training course? What was your grade?

The company can raise the claim against you for liquidated damages provided they can prove that a specific amount was spent on the training. Otherwise, the claim is not legally tenable.

Thanks,

Dinesh Divekar

Dear friend, after analyzing the terms of the contract, the purpose of your leaving the job in 18 months from the date of joining, the claim of the employer for liquidated damages of 12 months' salary as a precondition for formal exit, and the prospective employer's insistence on a formal relieving letter from the previous employer, if you have the time and wherewithal, you can fight the case by boldly quitting the present job. However, you will need to find another job as the prospective employer will require a formal relieving letter.

Alternatively, you may choose to have the patience to stay in the job for 6 more months to complete the agreed-upon 2-year period (provided the employer does not interpret the clause as two years from the completion of training). A year of training may seem unusual for a fresher unless it is a systematic institutionalized training program without the full job responsibilities for which the person was hired.

In my opinion, you could wait for the completion of the two-year period as agreed and then explore other potentially better job opportunities. Otherwise, you can negotiate with the employer for a reduced reimbursement amount to achieve a peaceful and formal relief.

Please let me know if you need further assistance or clarification.

Dear Dinesh Sir,

Answers to your questions:

1. I joined as a trainee engineer as I am a fresher, and I was absorbed into this company after 1 year. There were no specific classes provided for training.

2. As I am a fresher, I received a monthly salary the same as other employees as per the service agreement.

3. No training material was given to me by the company.

4. No, there is no training department responsible for training, and no exams were conducted after the training period.

5. They provided me with a confirmation letter after one year, confirming my absorption as a permanent employee. No specific amount is mentioned in the service agreement, which is considered a liquidated amount.

I am in trouble and have lots of confusion regarding this clause. I asked the management team about this, but they are unable to give a satisfactory answer. Please give suggestions on this matter.

Thank you