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Breaking of service bond

Page no : 2

RAVI KUMAR (PROPRIETOR)     01 March 2011

Dear sir,

I have seen your advices on the site which are extremely soothing and practical.   we have a problem, hope your advice will help us.  My son is from bangalore.  He was employed by L & T with a service bond for 2.00 lakhs ( if he resigns before 2 years).  He is a BE (civil).  He worked for about 6 months at Chennai.  He was put to work with electrical engineers, and he was tortured beyond his tolerance.  He was made to work from 9.00 to 10.00pm.  sometimes, overnight he has to stay at office.  He has become tired.  Besides hard work, there are , dirty politics between seniors, and each one trying to boss over my son.  They do not like him to dress well, and similar issues.  He gave a notice of resignation a months back, and they said he can quit.  But, now they are witholding the salary and PF etc;.  Also, they are threatening to sue him and recover the 2.00 lakhs from us. 

Can you please advice us the course of action we have to take.  Can the company really sue us?  Expecting your valid advice please.

RAVIKUMAR

 


(Guest)

Dear Suraj,

 

Are you still Engineer TRAINEE (Design), or you have been postd on some other post with some other designation? Probably only this distinction can provide you some relief, but through court of law only, if your advocate would e eady to make proper home work for deriving benefits out of he loopholes of the agreement. Otherwise the conditions of your agreemnt are quite tough for you as well as you surety.

 

However, there is another exit route for you. You may try to get your posting in some other Central PSU, but only through proper channel only, as this ould enail consent of your employer to relieve you for the post for which you would b selected. Resignation in that case would be treated merely as a technical resignation and all your past service with your present company would also be counted for the purpose of retirement benefis.

 

PS Dhingra

Chief Executive Officer

Dhingra Group of Management & Vigilance Consultants

New Delhi-110089

Mobile: 09968076381

[dcgroup1962@gmail.com]


(Guest)

 

Originally posted by :suraj1110abc
"
I GOT AN INFORMATION ON THIS IN OTHER WEBSITE AS FOLLOWS""
In India Bond is illegal as follws
As per the Indian Statute bonded labor system was long abolished and no bond can force any person to work against the employees wishes
Article 19 of Indian Constitution talks of fundamental rights, as per the Article 19 the Constitution the write work is a fundamental right, and under no circumstance does the Fundamental rights under Article 19 be waived by any person nor can any person be forced to do something that’s amounting to the violation of the rights mentioned under Article 19.
[b]As per the Indian Contract Act contracts entered between two parties if is one sided then such contract would be null and void. Most of the Bonds are one sided.
Again as per the Indian Contract Act no contract can be enforced on any person if the contract which is being so enforced causes any harm to the person on whom its is enforced and if performed would violate principles of natural justices.
[/b]As per Sec 368 of Indian Penal Code if any person or institute holds back any document or any use any legal document or threatens any legal suits or actions and thus forces a person to perform any act against his wishes or which is illegal or wrong as per the statute of Law of the land.
Sec 368 of Indian Penal Code talks about extortion by the threatening to file a legal suit. The minimum punishment under this act is 2 two years.
The Supreme Court of India has clearly stated that no employee can be forcefully employed against his will, just because he has signed a contract with the employer.
The court also has stated that the employer can not hold back any personal document of the employees as they are earned by the employees and the company has no claim on the same.
[b]Any complain on the company would land the Directors and Managing Directors of the company in Jail, as the company is not a actual living entity but legal entity and the management are hands and heads of the company.[/b]
Bonds are applicable only if the company has spend money on the personal grooving and enhancement of the employees, but not just a training that helps employees perform better."""
 
CAN ANY BODY  EXPEDITE ON THIS?
"

 

Dear Suraj,

 

Please don't get misled by the Act on Bonded Labor.

 

The provisions of the Act applies to the labour force who are under agreement to serve on account of some debt from a particular person.

 

As per the provision of the Act, the forms of forced labour is --
Adiyamar, Baramasia, Basahya, Bethu, Bhagela, Cherumar, Garru-galu, Hali, Hari, Harwai, Holya, Jana, Jeetha, Kamiya, Khundit-Mundit, Kuthia, Lakhari, Munjhi, Mat, Munish system, Nit-Majoor, Paleru, Padiyal, Pannayilal, Sagri, Sanji,Sanjawat, Sewak, Sewakia, Seri, Vetti.



So the service people do not come within the purview of the bonded labour Act.



Of course the Act has the need to be amended to cover any type of bond.

 

PS Dhingra

Chief Executive Officer

Dhingra Group of Management & Vigilance Consultants

New Delhi-110089

Mobile: 09968076381

[dcgroup1962@gmail.com]


(Guest)

 

Dear Raj Hans,

Had you attached copy of your service agreement that could have helped o find appropriate solution. Can you attach a scanned copy of the agreement with your employer?

 

PS Dhingra

Chief Executive Officer

Dhingra Group of Management & Vigilance Consultants

New Delhi-110089

Mobile: 09968076381

[dcgroup1962@gmail.com]

 

Originally posted by :raj hans

"
sir, i m workng with PSU insurance company...i have entered into service bond of 4 years...while applying, there was option of preferred place of posting....but after 2.5 months of training....i was given posting in Maharastra whereas I belong to chandigarh...company said that there is no vacancy available in or near your hometown dats y u were given posting in maharastra...but the truth is dat a female candidate was given posting in chandigarh and many other people were given posting in delhi n ludhiana(places near chandigarh)...


probation periiod is of 1 year which i hav completed...n even during probation period i applied for request transfer( an employee is eligilble for request transfer only after 3 yaers of continous service)... 5 months have elapsed since then bt i was nt inimated abt my request status..

i m planning to leave the job...as per service bond if i leave before 4 years i have to pay i year of gross salary plus 25000 training charges...

is there any legal remedy.. kindly reply
"

(Guest)

 

Dear Vivek,

 

It is the prerogative of your employr to give you or refuse to issue NOC. Every thing is not mentioned in the agreement. Only important binding clauses on both the parties are included in the agreement.

 

However, if you can attach copy of service bond, some solution can be possible to be suggested.

 

PS Dhingra

Chief Executive Officer

Dhingra Group of Management & Vigilance Consultants

New Delhi-110089

Mobile: 09968076381

[dcgroup1962@gmail.com]

 

Originally posted by :vivek malhotra

"
I joined a leading PSU as engineer trainee and entered a service bond for one year and one lakh.Now I want to join another PSU by apperaing in the interview and selection exam.My present employer is not giving me the NOC for appearing in the interview of the other PSU while this new PSU is asking for NOC from present PSU.

 

The terms of present bond do not say that I shall not be given an NOC and that can be diluted if I pay the stipulated amount therein

 

How this present PSU can refuse the NOC.As per presetn DPE guidelines there is no requirement to guideline to not to issue such an NOC.

 

pls advise
"

Moiz Sharaf (Design Engineer)     20 March 2011

Sir,

 

I am presently doing job in a MNC company as a Trainee engineer since 3 and half months and i have signed a bond of 1 lakh rupees for the period of 3 years. But due to some family responsibilities i can't continue for this job. And one of the point in my appointment letter states as under

"if your performance during the training period was found satisfactory and if there is any suitable vacancy in the company then you shall be taken on the roles of the company as a permanent employee and for that purpose you shall execute on indemnity-cum-surety contract where in you shall work for a minimum period of three years"

So according to the above paragraph the bond will be implied after i am permanent employee of the company..???

if not so please help if there is some another way for the termination of the bond.

 

Regards,

Moiz Sharaf.

Kirti Kar Tripathi (lawyer)     20 March 2011

The condition is " you shall be taken on the roles of the company as a permanent employee and for that purpose you shall execute on indemnity-cum-surety contract " this mean parties to the aggreement have entered into a new contract. If the parties have not executed any new contract, the condion of of working for further period will not be binding because the of the language in the said clause terms must be expressively be executed in terms of contract, the consent can not be deen to have granted  impliedly.

1 Like

Moiz Sharaf (Design Engineer)     21 March 2011

Mr. Tripathi,

          Thank you for your advice. My contract is dated 21 st of december and the appointment letter is dated 27th december. so as no new contract has been made between me and the company after 27th dec., has the company right to file a case against me..???

 

regards,

Moiz 

Mohd Ilyas Akhter (Officer)     08 July 2011

As an HR officer in a metal gaint, I can sense this Bond practices becoming a new form of bonded labour in the industry. People are forced to take the training that is the reuiremnt of the company and are forced to sign on the bond for liquidated damages of value around ten times of the cost of training.

My concern: Is there any clear Bill/Act/Rule governing the bond or it's the sole discretion of the employer who is on the higher side  to force such bond or ask to resign.

It has been also observed that once the bond is there the companies start trearing employees as bonded labour and over rule all teh acts related to working hour, benifits, hike, payment of over time etc.

Is there any organisation or association in India to help people get liberated in the senerio  of neo bonded labours?

Kumar Doab (FIN)     09 July 2011

Learned Mr. Sarjooram Sharma, Mr. Vasudevan, Mr. Srivastava, Mr. Dhingra, have elaborated and have nicely explained the matter from the view point of employee, employer, law, industry. Clarifications provided by them shall many facing such situations.

 If you have decided to terminate your association with the company you can evaluate your options.

 Have your services been confirmed in writing, and have you received any confirmation letter and have you given your acceptance on copy of confirmation letter?

If not you are still under probation, as per the agreement.

As already suggested by learned Mr. Vasudevan, you can liberate your self by tendering a notice of 3 months or notice pay in lieu of notice period. 3 months notice during probation is unreasonable. Company may come up with their version and you can contest it. You should avail the services of a competent and good lawyer/law firm who is willing to take up the cause and spirit of your case, and then you can focus on your future ventures. You must regularly coordinate with your lawyer.

You have posted that:

-You had expressed during interview that you are not interested to be posted in the domain in your department. Did you ever express yourself in writing?

-6 months back you had to attend training as a part of your work, and you were not interested in this training. Did you express yourself in writing?

Cost of training for 5 days was 1 lac. Was this training at a foreign location? The cost is per person or for a group? Was this conducted within company premises and was it imparted by company or an outside faculty?

1 lac per person seems to be a huge amount. If a situation arises company shall include this amount in their claim.

If you have a union (if not you should form one) it should intervene and obtain the cost details and unions can even propose that such training can be conducted at a lower cost.

Since it is a PSU, you can obtain the cost details of training and post training, what are the benefits/profits you have generated with your work, from company or thru RTI.

-You are being tortured by two of your superiors. Did you ever express it in writing, or verbally? It is always better to put up the matter in writing. Good companies have escalation matrix, and grievance redressal mechanism. They are supposed to reply to complaint and grievances. If you have signed a bond and even provided a surety does not mean that you should be treated badly and made to forget about your rights, self esteem and dignity. If your dignity is attacked and your ill treated at work place and despite your representations in writing or verbally, you do not get any relief, it is a valid reason for you to declare your employer unworthy of working with. You shall need evidence to prove or company shall be able to terminate your charges as flimsy.

 Your company may sit on issue of NOC to you, if you apply for another PSU. If you join without NOC, your company may still chase you. There are many cases like this also.

You should obtain data: how many people applied for NOC and how many were given NOC. For company this shall also be job hopping.

Kindly be prepared for all situations and take a suitable decision.

How did you apply for this job, campus placement, advertisement in paper, etc…?

How many vacancies were there and how many people applied, and how many were short listed, how many set of interviews were conducted at how many locations, how many people were involved in interview committee, and what was the cost of interviews, and what was the amount of application fee if any collected from each applicant?

The organizational planning shall not cost 10 lacks per person, which are to be recovered thru employment in the tenure of 5 years and if the person leaves in the interim, company shall suffer a loss of, 10 lacks/person.

The numbers of institutes have increased and they have become factories, producing engineers, doctors by huge numbers and there are a few vacancies and big number of applicants.

The resolution has to start from basics:

-Companies hopping institutes should disclose to managing committee/legal cell of institute, students and their parents about service bond, other documents and student should sign   after counseling on the content of the documents. Parents, student unions, etc have to play a very vital role on this.

-Parents, must impart knowledge to their wards on their rights, legal aspects, to remain united and should have access to legally trained minds and inculcicate a habit of seeking legal advice rather than acting in haste. It is better than repenting later.

-Employees should defend themselves, form unions, and help each other and support evidence. Anyone may need it at any point of time.  Form communities and provide case details to each other.

Banking and Insurance Sector: workmen, managers have unions.

Pharma: Struggled and obtained protection under SPA. Managers have union e.g Kolkotta.

In todays market scenario a trend has emerged, employment agreements on letterheads and stamp papers,and a new sector has emerged, where such agreements are crafted seemingly to perfection, by master carftsmen. However an agreement may be prepared on one paper or 10 papers, if employee does not commit a blunder mistake in the end in majority of the cases employee gets relief.

Be smart.

sekar (retd)     17 October 2011

The PSUs take a bond for unreasonable periods or amounts.why do they take this if it is to  be challenged or disobeyed by the employee?Are there any case laws on the issue.

I have signed a bond with a PSU for 10 years or 10 L.Now the co spent nothing on my training and did not offer me a suitable job after my completion of highly skilled training at my own cost.Now I gave notice of resignation(one month) they are neither writing me reg their views on my resign or allowing me to join the new co at a higher post.The period is over and I have joined the new co. But the security pass and IDs are with me and the PSU is not accepting the return of these.If these are not returned apart from the security risks , I may have problems in the new co and with the agency which issues the security passes. Is there any authority to receive doc in such cases?What happens to my salary,PF, etc? Why are laws not categorical on these.    pl spare yr time Sir.....thanks

Osiris (Engineer)     27 October 2011


Hello Sir,
I am presently working in a PSU and will leave this within few months. Meanwhile I have applied in another central Govt job,But didnt informed to the PSU and neither has shown work ex. in central govt deptt.This is because of bad enviornment in officeand company they wont let me go for giving exams.
I have a bond of 2 lacs and 5 yrs in PSU. After resigning I will pay complete bond and will resign after giving one months notice(properly relieved).I wont be absconding.
But my point of concern is that in future can this create any problem "suppression of facts" with my new employer, if in case they discover it. Please advise me, this is killing me.
Its very urgent.
Thanks in advance

kumar (tester)     29 October 2011

hi sir,
i have signed a bond of training-cum-employment on date 22 oct in this bond have promises like..breach,3 year service bond etc..and and i also accept offer letter on 22oct 2011..and my joining date is 16Nov 2011 but now i do not want to join the company..can this agreement legal before joining the job...but in agreement says that it works from 22oct..before joining its work for me??plz answer me i have very limited time...plz help me

kumar (tester)     29 October 2011

hi sir, i have signed a bond of training-cum-employment on date 22 oct in this bond have promises like..breach,3 year service bond etc..and and i also accept offer letter on 22oct 2011..and my joining date is 16Nov 2011 but now i do not want to join the company..can this agreement legal before joining the job...but in agreement says that it works from 22oct..before joining its work for me??plz answer me i have very limited time

Dinesh kumar (TSE)     28 January 2012

Respected sir

I am working with privete organisation since last one year and i have asked to sign a bond for five years post one year probation. and the bond ammount is Rs. 500000. They have taken five checks of Rs. 100000 each signed by me . I got posted in southern region. the weather conditions and food habits are not suitable to me. i want to leave this organisation. In this case what will be the consequencies legal as well as financial, because i am not able to pay this much of amount. please guide me regarding the same.

 Regards:

Dinesh Kumar


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