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Breaking of service bond

Page no : 4

SRS18 (Employee)     25 August 2014

I work in an MNC.
I Joined in 2013 as Engineer trainee. And in the appointment letter itself, it was mentioned a bond of 2 years after one year training.
-->Training (3 months classroom training+ remaining on job training (but we were working normally during this))
After the training we were asked to sign a 'Service Agreement bond' on Rs 100 stamp paper. It states that we have to pay 2 lakh in case we leave the company before 2 year (on pro-rata basis)
now i am in bond for two years i.e 2014-2016
But, I am looking to study further. Can I leave the job without paying 2 lakh.

Kumar Doab (FIN)     25 August 2014

You have yourself pointed out that 'You were working regular employees' and hence if you have irrefutable evidence and can substantiate your contentions then your lawyer may opine that  BOND is VOID.

 

Approach your lawyer with copies of all docs on record and understand the merits before you proceed further.

SRS18 (Employee)     25 August 2014

"irrefutable evidence and can substantiate your contentions"

Please elaborate.

Because I am not planning to go for any other job, but studies instead and may not require any experience Letter. I still have pay or at least challenge them through Lawyer.

Kumar Doab (FIN)     25 August 2014

If no training that added to qualification, extra ordinary skill..................was provided and you worked like regular employee then your lawyer may opine BOND is void.

You shall need to contest the claim of the company successfully and for that you shall need solid proof/evidence and show it to your lawyer to understand the merits.

Service certificate should be issued to all employees, along with FnF statement, Form 16 as per correct FnF statement, payment of FnF wages that you may demand by Bank DD only thru Redg .Post only so as to reach in next 7 days..................... The company may decline to  issue relieving letter.

You shall need Service Certificate for your future endeavors even if after studies.


Your lawyer after examining the docs on record and merits may opine that you can think of option of Pro Rated payment.

If the matter may land up in court of law: reasons and reasonableness of the matter shall matter and it may also decide Pro rated payment as reasonable.

Approach your lawyer in person.

SRS18 (Employee)     27 August 2014

Thank you 'Kumar Doab'.

I do not want any court issue or anything. Is it possible to just get away, I mean I don't need any letter from them, but I can't afford to pay 2 lacs also.

Since I want to study and don't want to work anymore..... can I do that without paying bond amount. I mean we were given good training no doubt. But associating with them for 2 years more, will affect my aspiration to study more.

Kindly Suggest.

Kumar Doab (FIN)     27 August 2014

You have posted that:

----“It states that we have to pay 2 lakh in case we leave the company before 2 year (on pro-rata basis) now i am in bond for two years i.e 2014-2016”

 

This implies that option of Pro Rated payment is available in BOND signed by you.

 

Therefore 200000/24* No. of months is the amount to be paid by you.

 

Negotiate and arrive at an amicable solution in writing and ask the company to show the amount in FnF statement and pay by cheque against acknowledgment on the spot and  walk out with acceptance of resignation, service certificate, relieving letter with good comments (avoid without comments/adverse comments), FnF statement, salary slip for all months,Form16 as per correct FnF statement, NOC/NDC, acknowledgment of handover of charge/company property, PF a/c slips of all months, ESIC card, etc…………………

Thus you shall have no implications in future e.g. adverse feedback during reference check, BGV etc………………………no court case.

 

----“I do not want any court issue or anything. Is it possible to just get away, I mean I don't need any letter from them, but I can't afford to pay 2 lacs also.

You have signed the BOND by your free will. The employer has the discretion to issue legal notice/approach court of law. If it does not then you won’t face any such consequence.

It is unlikely that employer shall not chase you and sureties that have signed from your side. Otherwise everyone and anyone can walk out on the face of employer.

The employer also has the power to waive off BOND/Liquidated damages, and you can try by appealing for it, to good offices of appointing authority, MD, Chairman…………………...

 

 

----“Since I want to study 

The Training was under Management’s Training Programme/standing orders or Apprenticeship under Apprenticeship Act?

If it was former download the Rules and regulations framed under such programme and also certified standing orders from shared portal or obtain from HR personnel in writing under proper acknowledgment.  

 

If it was Apprenticeship under Apprenticeship Act then:

You may refer to Apprenticeship Rules 1992: SCHEDULE-V:See Rule6: Obligations of Employer (both in the case of Major and Minor Trade Apprentices).

            (Under section /I of the Apprentices Act, 1961)

 

There is provision to end apprenticeship in case of studies and 3 month’s stipend is payable.

 

 

It is suggested that you should consult elders in the family, competent and experienced well wishers…………………………………and along with them your lawyer……………………………………and proceed under expert advice of your lawyer…………………………and avoid acting on your own.Let your lawyer structure and draft all of your representations.

SRS18 (Employee)     28 August 2014

Thanks Kumar Doab Ji.

 

Your advice is good and I'll follow it. But I Think Bond is not a correct practice in all cases.

I mean if someone wants to study then there shouldn't be any bondage. Because my office hours are killing. I mean from 7.00 am to 7.00 pm (including travel time) I can't think of doing anything else. How do I manage to study, I Think I have to work for them for free and save salary in my account to payback the amount.

This also a learning experience.

 

Thanks,

Kumar Doab (FIN)     28 August 2014

The work hours are also stated in the Act.

 

United employee’s can form ‘Works Committee’s’ and that is an authority as per ID Act and united employee’s can negotiate service conditions.

The Industrial Disputes Act, 1947: CHAPTER II: AUTHORITIES UNDER THIS ACT

3. Works Committee


Consult elders in the family, lawyer before signing on the dotted line 

vicky (engineer)     11 December 2015

Dear Sir Does anybody have any judgement/copy of order of supreme court in favour of employee in such case. If yes please provide judgement instead of arguments like article 19 so and so....

Kumar Doab (FIN)     13 December 2015

@ Vicky, There are judgments. IN case of a bank the court declared the practice against banking regulations as well. Let your counsel choose the judgment if the need be at appropriate time.

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