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Pratik (SE)     27 July 2012

Bond amount recovery

Request for Advise:

I worked in IT company in mumbai who Signed a agreement on bond paper for 2 years for amount Rs 75000. I have amount in bank in my name with Companies hold. To withdraw I will need Company's NOC.
The Bond says that if employee under goes any training in company and in event of breach of agreement within 2 years a said amount will be recovered.

I had not taken any trainings from the Company as i got placed from a Institute after training and was taken directly for working on Project.
I had to resign after a year due to relocation problem. All my clearance was done without any Outstanding. Also there was no pending recovery amount against the Training while clearcance.

Now when I asked the company HR for the NOC to withdraw the Amount, HR says As per the policy, you have not completed the agreement period.
Principle FD amount will be recovered by the company and the interest
amount will be paid to you.

I don't think according to the Agreement, recovering the Bond amount is applicable in my case as i havnet taken any trainings and used any company resources.

1)Can Company recover amount in this case ?
1) What can I do in this case in order to get the bond amount ?
Please adivse me as early as possible as its urgent !!

Thank You



Learning

 8 Replies

Kumar Doab (FIN)     27 July 2012

The language of the bond can be tricky. It shall be appropriate to show the bond, appointment letter, HR policy, employee rule book, standing orders (if any)of the company to a competent and experienced service lawyer.

Or you may post in this thread. To protect the confidentiality you may remove the names etc.

Apparently if no training is provided company should vacate the lien on FD.

Obtain standing orders of the company as the practice of lien on FD and bond may be against the standing orders (if any) of the company.

It is believed that the statement of HR is verbal. In all probabilities HR shall refrain from making such statement in writing. Employee should record (audio/verbal) such transactions.

If you are confident that  clause of lien on FD is applicable only in case training is provided by company you may raise a query to the company employee who has signed don the bond and D, appointing authority and seek a reply in writing only.

Is it mentioned that lien shall remain applicable in case of relocation also or this is not mentioned in bond?

 

 

 

 

Pratik (SE)     27 July 2012

PFA the agreement and appointment letter for Ref. 

Thank You


Attached File : 209965349 agreement copy edited.pdf, 209965349 appnt let edited.pdf downloaded: 254 times

Pratik (SE)     27 July 2012

Thanks for Reply

I havnt had any verbal communication with the HR. Nothing mentioned about the relocation in the Bond.

Kumar Doab (FIN)     28 July 2012

ClauseNo:  You have to necessarily clear test L1 in a single/first attempt.

Clause No.11: Your services are additionally subject to terms of the service agreement.

Clause No.21: You can be transferred.

 

 

Service Agreement: 9.5:”Employee unconditionally and irrevocably agrees to direct and authorize the bank to act on the instructions of the employer without going into any details………………..without any reference to the employee………..valid and effective discharge to the bank”

Clause No:  All allowances, salary paid is also mentioned as a component of claim.

Clause:9.7: is Surprising.

 

This is one sided agreement and takes us back to the feudal era of “Sahukar”

(Moneylender) whereby by obtaining Angootha (thumb impression) on Bahikhata (Ledger) would enslave the   citizen and his future generations.

The question arises can bank approve of passing such an agreement and be party?

 

The company has mentioned in the agreement that scope is not limited computer time, instructor time, supervisory time, etc.

“Now when I asked the company HR for the NOC to withdraw the Amount, HR says As per the policy, you have not completed the agreement period.
Principle FD amount will be recovered by the company and the interest
amount will be paid to you.”

This reply of HR is in line with agreement signed by you.

 

You have stated “as i havnet taken any trainings and used any company resources.” The answer lies in your very own statement. You may submit a representation in writing and submit under acknowledgment by Redg. Post, addressed to the good offices of your appointing authority, MD, Chairman, Company Secretary, and seek a reply in writing by redg/speed post, hoping that the sense may prevail.

You may apply your goodwill, rapport, exceptional levels of negotiation, persuasion, persistence, reasoning skills and hope to get a waiver. You may follow up by email with a copy to you and attach scanned image of your representation.

 

You may seek legal opinion from your lawyer as you have claimed no training is provided, therefore can you mark or supply copies to witness(es), guarantor(s)  if any , and they write to company expressing cancellation of their witness and guaranty as no training is provided which is essence and ground of agreement. 

In case the gentle representations fail, you have to agitate and would require a lawyer.

If you do not represent employer may construe it as your acceptance to FNF settlement.

As you do not wish to surrender the amount of FD, it shall be appropriate to approach a competent, smart, experienced service lawyer as ap and let your lawyer structure your representations, build record to support you in the long run.

You may submit notice of resignation addressed to the good offices of your appointing authority, MD, Chairman by redg post, followed up by email with a copy to you and manage to obtain acknowledgment and acceptance of your notice of resignation, and final resignation and request the good offices to vacate the lien on FD.

You may submit a notice to the BM of the bank, nodal Officer, Chairman of the bank and lay claim to the proceeds in FD and prohibit the bank to release the proceeds to company until or unless you submit your written concurrence. Let your lawyer structure and draft this notice.

You must take your next employer in confidence and appraise in writing even if by email, and build a relationship strong enough so that the new employer does not desert you in case current employer writes to new employer. You may inform new employer preferably in writing even if by email, that you can provide only copy of resignation and its POD and your current employer may not issue acceptance of resignation, relieving letter, and you may be appointed on the strength of copy of resignation only.

 

 

It is difficult to understand why an employee would want such an employment.

In a given situation employee can invoke the Industrial Employment standing orders Act, Payment of Wages Act, SE Act, and ID Act as per explanation of employee under these Enactments or approach civil court.

Employee should always consult elders in the family, competent and experienced well wishers before taking a decision and signing on dotted line in haste.

In majority of the states IT companies are exempted from Industrial Employment Standing Orders Act. You may check it for your state. There is publication that state of Karnataka is doing away with exemption. The vote bank strength of employees which is huge can force other state governments also to withdraw the exemption. Employees should join hands and peruse thru the elected leaders starting form area councilors to top and make it happen. Employees in your sector should join hands and form unions.  

Companies grant fancy designations and strive to keep the employee under impression that he/she is not a workman as many enactments applicable to workman limit the option to employer. However designation alone does not decide employee is a workman or not. 

2 months notice period during probation seems to be unreasonable. It is felt that for 6 months you were kept as trainee and no notice period should be applicable to trainee.

You may refer to SE Act applicable to your state and refer to the clause on Notice of Dismissal. You may find notice period mentioned as 15 days/1 month. As per SE Act service certificate, which is government version of relieving letter without any scope and column for adverse comments, should be issued by company to employee. SE Act may come to your rescue. Bombay SE Act is enclosed.


Attached File : 423674204 the bombay shops establishments act.pdf, 423674204 417759075 validity of employment bonds.pdf, 423674204 background paper.pdf downloaded: 255 times

Kumar Doab (FIN)     28 July 2012

You may find the attachments useful.


Attached File : 423674204 karntaka now applicability%20of%20standing%20order%20to%20it%20industries.doc downloaded: 265 times

Pratik (SE)     29 July 2012

Hello Kumar Sir,

Thank You for your Advise.

Below points I would lke to share.

1)I had resigned and all my clearance was done without any outstanding after 1 year in April 2011. 

2) I have also recieived the Exp letter and releaving letter , F&F settlement.

3)Now in July  the FD was getting matured and had to withdraw the amount from the  Bank So i droped a mail to HR to provide the NOC for withdrawl when they refused to give the same and mentioned about the recovery.

Thank You

 

 

Kumar Doab (FIN)     29 July 2012

As company has issued relieving letter , F&F settlement, apparently company has not staked any claim on FD.

Apparently company has lost stake on FD.

Has the company issued FNF statement?

If FD has matured you may first inquire with bank whether bank has rolled over the FD and interest has accrued.

You may try by writing to bank about full and final settlement and demand to cancel the lien.

Has the company refused to issue NOC in writing and if yes has it been refused by the company employee who has signed on the bond or appointing authority?

You may try to get the lien vacated by writing to good offices of your appointing authority, MD, Chairman, company secretary citing FNF settlement and request to vacate the lien. Good offices can provide relief. In case the good offices maintain silence you may issue say 2 or 3 reminders.

If no relief is provided you may approach a competent and experienced service lawyer and legal notice from your lawyer may fetch you relief. Your lawyer may decide to issue notice to bank as well.

Or you may approach the O/o Labor Commissioner or civil court ads per your eligibility. Your l lawyer can clarify you can approach ALC under ID Act, SE Act or civil court.

Kindly update the developments in this thread. This shall help many who visit the forum and might be facing the same situation.

 

Pratik (SE)     30 July 2012

1)Bank has rolled over the FD aalong with the Interest for Another 2 years.

2)For now my commincation is through as my and company location is different. I have replied them saying "I had not taken any trainings from the Company" so how can company recover the amount (As bond is not legal in India) waiting for the reply.

3)Will wait for reply else will use the advised appraoch of sending a letter by writing or using a lawyer.

4)Will also try writing to Bank to cancel the FD. (Previoulsy I had mailed asking that I have resigned from the company please let me know process for Closure. I got a reply asking for NOC and written instruction from me.)


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