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Sachin Gupta (Software Engineer)     16 July 2013

Should i sign on such kind of bond

1. To serve the company for minimum of two year commencing from the date of 

execution of this agreement. I also agree that in event I intend to leave the company

for any reason whatsoever prior to completion of two years from the that of execution

of this agreement, I will compensate the company with an amount of my last drawn

six months' salary.

 

2.The employee shall not engage in the job similar to company's product after

termination of job for 3 years.

 

3.The employee shall not engage in selling application directly or as a company, on

online stores namely Apple App store, Android Market, Nokiya Ovi Store Intel App 

store but not limited to, for 3 years after termination of association with 

XYZ company(It's where I am employee).

 

Please Help me on this---



Learning

 5 Replies

vivek malhotra (Advocate)     16 July 2013

Its at your descrition. Usualy private companies made to sign some bond before giving the employment. 

rafa (eheh)     16 July 2013

Are points 2 & 3 really valid as per the Indian Law ??

vivek malhotra (Advocate)     16 July 2013

It is the company policy 

rafa (eheh)     16 July 2013

I understand that its the company policy, since they are the ones declaring such rules.
What I reallly mean is, wether someone can legally force/prevent someone from working in certain/specific fields or sectors even if they happen to be his/her employer.
Are such kind of clauses/contracts valid/legal ?

Kumar Doab (FIN)     16 July 2013

 

You have posted that:

 

-----“Should i sign on such kind of bond

NO.

 

 

------“Are points 2 & 3 really valid as per the Indian Law ??”

 

2.The employee shall not engage in the job similar to company's product after

termination of job for 3 years.

 

There are some important points you may look into before you decide finally:

 

>If you sign the contract to work for a specified period and separate before completing the specified period the restriction may apply.

Your lawyer may opine that negative covenants may be applicable during the period of contract.

 

It shall be appropriate to show the job advertisement, interview call letter, offer letter, joining report, induction report, any communication exchanged with any one in the company till date, appointment letter, agreement/bond signed or to be signed by you to a competent and experienced labor consultant/service lawyer, in person along with elders in the family, and understand the merits before you proceed further.

If in your trade no employer would employ without getting such bond, employee should be careful to build sufficient and favorable written record for use and relief at appropriate time in appropriate forum, and maintain permanent access to a lawyer of caliber and always proceed under expert advice of the lawyer and avoid legal traps.

 

If the employer pulls the employee to court of law, the court of law shall decide.

 

 

> Liquidated damages are not to be paid on mere asking.

 

Liquidated damages may need to be established.

 

 

>Employee can not be restrained to join any other employer after separation and non compete clause amounts to restraint of lawful profession.

An agreement, which restrains anyone from carrying on a lawful profession, trade or business, is void to that extent. Under section 27 of the Indian Contract Act, 1872 agreements in restraint of trade are void.

 

 

Indian courts have consistently refused to enforce post-termination non-compete clauses in employment contracts, viewing them as "restraint of trade" impermissible under Section 27 of the Indian Contract Act, 1872, and as void and against public policy because of their potential to deprive an individual of his or her fundamental right to earn a livelihood.

 

 

3.The employee shall not engage in selling application directly or as a company, on

online stores namely Apple App store, Android Market, Nokiya Ovi Store Intel App 

store but not limited to, for 3 years after termination of association with 

XYZ company(It's where I am employee).“

 

 

Is this application a confidential and/or proprietary data/copyright data/exclusive property of the company  ………….etc?

You alone would know it, better than anyone else.

You would need to explain it to your lawyer and understand the merits under this specific condition, and that does it amount to Protection of Confidential Information under Indian IPR laws…………………….. Remedies for Protection of Confidentiality under the Indian Law etc…………..

 

Thus you shall be able to not to be accused of breach of agreement/breach of confidence/criminal breach of trust…………………….etc

 

> The exception being extended to confidential information and non-solicitation agreement to a reasonable period of time are valid……………………..

 

 

Valuable advice of learned experts/members is sought.


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