Hi Everyone, Is it enough to implement employee bond on Company’s letterhead or should it be legally notarized? Thanks Swati Chawla HR at Zero1 Inc
From India, Delhi
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From India, Delhi
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In order for an employment bond to be enforceable, it has to be executed on stamp paper of appropriate value. Going to a notary will not be useful
From India, Pune
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3180From India, Pune
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Dear Swati Chawla, It is always advisable to get the employee bond on stamp papers and notarize the same.
From India, Hyderabad
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From India, Hyderabad
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Notary Act India 1952
Sec 8. Functions of notaries.- (1) A notary may do all or any of the following acts by virtue of his office, namely:-
(a) verify, authenticate, certify, or attest the execution of any instrument among other duties. Therefore, notarization does not add value.
If needed, a bond on Rs500 stamp can be executed between the company and employee. Value of stamp can vary from state to state, and a local lawyer can tell you the exact amount to be paid and the value of the stamp paper.
From India, Pune
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Sec 8. Functions of notaries.- (1) A notary may do all or any of the following acts by virtue of his office, namely:-
(a) verify, authenticate, certify, or attest the execution of any instrument among other duties. Therefore, notarization does not add value.
If needed, a bond on Rs500 stamp can be executed between the company and employee. Value of stamp can vary from state to state, and a local lawyer can tell you the exact amount to be paid and the value of the stamp paper.
From India, Pune
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Dear Swati any agreement done between two parties would be on stamp and notarised whether bond or contract or others etc.
From India, Indore
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From India, Indore
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Some companies require trainees, such as Graduate Engineer Trainees (GETs), Diploma Engineer Trainees (DETs), or Management Trainees, to serve a minimum of 2-3 years with the company, or a specified amount will be recovered from them. A few years ago, an advocate advised me that such bonds do not hold up legally in court. It's merely psychological pressure.
However, if a company invests money in specific training, whether in India or abroad, and both employees and employers agree to it beforehand, such bonds are legally valid. Employees must then serve the company for a specified period, or they will have to compensate the amount invested in their training.
I would appreciate guidance from my seniors if they hold a different opinion.
Regards,
Lakshya
From India, Mumbai
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However, if a company invests money in specific training, whether in India or abroad, and both employees and employers agree to it beforehand, such bonds are legally valid. Employees must then serve the company for a specified period, or they will have to compensate the amount invested in their training.
I would appreciate guidance from my seniors if they hold a different opinion.
Regards,
Lakshya
From India, Mumbai
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Dear Lakshya, to say that bonds are unenforceable in courts of law would be too naive and may not always be correct. The service agreement bonds, to be enforceable as a valid contract, must fulfill the condition of having a reciprocal promise. Both the employer and the employee must make certain promises to each other. For instance, for all the training costs incurred by the employer, the employee agrees to serve for a minimum period of time, which is to be mentioned. Failing this, the employee agrees to remit an amount specified in the mutual agreement.
However, in most cases, there is no reciprocal promise or no account kept of the training costs incurred. In such cases, it is difficult to prove that the employer has suffered any loss, and consequently, any claim for damages for breach of contract would not be maintainable in courts of law. Let me also add that there are certain resource persons/agencies available who specialize in recovering bond money using not-so-fair means.
From India, Mumbai
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However, in most cases, there is no reciprocal promise or no account kept of the training costs incurred. In such cases, it is difficult to prove that the employer has suffered any loss, and consequently, any claim for damages for breach of contract would not be maintainable in courts of law. Let me also add that there are certain resource persons/agencies available who specialize in recovering bond money using not-so-fair means.
From India, Mumbai
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Validity of Bond.pdf
BOND BY AN EMPLOYEE FOR NOT ENGAGING HIMSELF.doc