Can My Brother Back Out After Signing an Offer Letter with a 3-Year Commitment? What Are the Risks?

My brother has received an offer letter from an organization, which he signed. One of the conditions of the offer letter is "You are required to commit to us for a long period of your service and you will execute an agreement to serve the company for a minimum period of 3 years from the date of joining." His monthly CTC is Rs. 10,000/-. However, he no longer wishes to join the job as he does not want to be bound for 3 years.

As he has already signed the offer letter, can he refuse to join the company? If yes, what legal consequences could he face?

Another condition of the company was "You shall be on probation for a period of 6 months and required to comply with all such rules and regulations as the company may frame from time to time." My question is, should the date of commitment start from the end of the probation period?

Please let me know if you have any further questions or need clarification.

Understanding the Legal Implications of Signing an Offer Letter

You have stated that the offer has been signed by your brother, but there is nothing in the offer letter indicating that it amounts to acceptance of the offer. Presuming it to be non-acceptance, it can be stated that the signature signifies only the acknowledgment of the receipt of the offer. If it is so, then there is no legal implication.

Acceptance and Legal Consequences

However, if there is acceptance of the offer of appointment, then the position is a little different. As per the Contract Act 1872, the offer once accepted becomes a promise, and the reciprocal promise becomes an agreement, and a valid agreement is a contract. As the saying goes, "A contract is an agreement; an agreement is a promise, and a promise is an accepted proposal." So the acceptance of the offer has rendered it to be legally enforceable. If you do not join by the date mentioned, then there is a breach of the agreement, and you are liable to pay compensation/damages. It is limited to the actual cost incurred for recruiting you and not any fanciful expenditure.

Thanks for replying,

1) How much compensation or damages can they recover, considering the salary is only Rs. 10,000 per month?

2) What are the chances that they will legally enforce this in court?

3) Please also address my second question from the original query.

Offer Letter Clauses and Legal Implications

To answer you specifically, is there any more clause in the offer letter after Sl. No. 8? As such, there is no penalty clause in the offer made, so we cannot put a definite sum as of now, as it would depend on the organization. Nowadays, some organizations are including a penal clause specifying the amount payable as a penalty in case the candidate, after accepting the offer, fails to turn up.

Legal Perspective on Job Offer Acceptance

Legally speaking, acceptance of the job offer letter does not mean that the employment relationship between the employee and the employer has started unless there is written proof clarifying that the offer has already been effective. The burden of proof shall be borne by the party claiming the start of the employment relationship. It is not an easy task, and it is unlikely that the organization incurs more expenses in filing a court case and all that.

The date of commitment starts from day one of employment.

1) No, after SI no. 8, there is no other clause. On the next page, it is mentioned, "Kindly sign the duplicate copy of this letter as a token of your acceptance and send it back." There is no penalty clause.

2) I was considering the worst-case scenario to prepare myself mentally.

Probation Period and Commitment

3) SI no. 4 mentions a probation period of 6 months. The probation period is the time during which the employer can dismiss employees, or employees can resign from the organization. Am I correct? If the commitment period starts from the date of joining, then I believe a bond agreement restricts the employee's ability to resign during the probation period. Is this correct, and can an employee benefit from the probation period?

Have you sent a duplicate copy of the acceptance letter?

After reading all the clauses of the letter, I do not think the company would go to court for not joining. Of course, be prepared for legal consequences, but it will really be a last resort. Litigation is expensive, and the chances are remote. The company will have to prove what they want the court to believe.

One lesson to learn is to be careful and think before you commit.

Offer Letter and Commitment Concerns

Yes, my brother signed the offer letter during the second meeting at their office, so the signed copy is with them. My brother is a fresher, and the salary offered is Rs. 10,000/-. I also think that for a fresher and at such a low salary, there is a remote chance that the company will pursue litigation. However, to be on the safer side, I want to be prepared for the worst-case scenario.

Commitment Period Concerns

Another condition they presented to my brother is that during the commitment period of 3 years, if he wishes to resign before completing the 3 years, he has to reimburse the salary for the remaining period to the organization. My brother agreed to this condition verbally, which worries me the most. For example, if one year from the date of joining my brother decides to resign, he would have to reimburse 2 years' salary to the organization.

The appointment letter and commitment have not been signed yet. Will it adversely affect us in any way from a litigation standpoint?