Are Employment Bond Papers Really Void Contracts? Seeking Your Insights

Hi,

I am an HR student doing my MBA. Recently, I came across in my business law paper that the bond paper which is being asked to sign by most of the companies is actually a void contract. Is it really true? I would invite your views.

Regards,
Meenakshi Gulati

Dear friend,

It is not a bond paper. It is a contract. There is a general perception that these contracts are void. It may not be so. It depends on the clauses and how they are implemented. For example, an organization employs a trainee and provides training for one year with special classroom lectures, projects, and a specified curriculum to complete. They also maintain records. In this scenario, any contract that is signed demanding the employee to be in employment for three years or five years will be legal and it will not be void.

Siva

Hi,

I have a question. In case a trainee in a BPO, who has taken training for over 2 months and even before he hit the floor for his performance, he vanished after taking the salary. The Pvt Ltd firm had made him sign a bond since they had provided him with door-to-door drop & pick up, training, and meals. Now he is afraid that they can demand the said sum of 75,000 in case he left within the 6 months. How does he get out of this? What can the Pvt Ltd firm do? Please advise.

Hi Mugud,

The only option for your friend is that he will have to get himself fired. The type of bond/contract actually decides its validity, i.e., the contents and the clauses. Although from an ethical point of view, I think the bloke is a loser, give the company at least a month or two months' notice so that they can afford to find a replacement and not leave the company the day your friend gets the money.

Thanks & Regards,
AJ

Hi,

Providing meals and door-to-door pick-up and drop-off are not the considerations for any such contract. The consideration is whether the company or the establishment has spent time and money to train the person. If the company has done so, then it is the consideration. Let us not be carried away by high stipend, working conditions, food, pick-up and drop-off, leisure time activities, first-time employment, etc.

Instead of using the word "bond," you can use the terminology "Service Contract." That may sound better and will carry some weight in the minds of those who sign this.

Siva