Service agreement breaking

If you can convince your employer for pro rated payment based on actual expenses by the employer than based on liquidated damages of Rs.3Lac, this may be the most suitable situation as you are probably looking for relieving letter for Govt. job.

Negotiate. Apply your resources and skills.

If you disclose to employer about this govt. job he may either sense that you are vulnerable and may not agree to negotiate or he may agree out of good nature.

Apply your judgment.

The employers are known to become rigid, adamant.

 The matter in the courts may take long time.

Before you leave, you may collect all records on all expense incurred on you and all revenues and profits generated by you. All appreciations, rewards, awards, issued to you.

Start preparing for the future now.

Has the employer spent any amounts on your training that added to your qualification and provided some extra ordinary/exceptional skill to you???

Or the onsite assignment was to work there for salalry and fetch revenues and profits for the company??

In the meantime you may find the attachments useful.

Thanks Mr. Kumar Doab for your reply.

Yes my onsite assignment was to work there for salary and fetch revenues for my company (Infact it was a intra-company transfer). Could you please explain me how this point would be helpful?

Also can I say to my company I am quitting this job to take care of my father at my native place? The actual reason that I returned from onsite was due to sudden demise of my mother. Now my father's health condition also in a worst condition and I have to take care of him. Appreciate your reply. Also please suggest me advocate specialised in this area in Hyd city.

Thanks!!!

You have posted that:

--“Before travelling I have signed a service agreement bond stating that I would serve for the company for min of 12 months.”

“I have travelled to onsite in 2009 and returned in 2012.”

These 12 months are already over. Hence you have satisfied the conditions of the bond.

--“ The document has a statement saying I further undertake to pay liquidated damage in the event of breach of this agreement Rs 3 lacs.”

If you have satisfied the conditions of service agreement as cited above you don’t have to pay liquidated damages.

Moreover liquidated damages must not be an imaginary/wishful figure or as per inner wishes of the employer. This should be substantiated by facts and figures.

If you have signed the agreement in 2009 then 3 years from year 2006 i.e. year 2009 is more than reasonable period to justify the contractual obligation.

What else company would want a life time/till last breath bonding???

Your lawyer can help you understand whether the amount expressed is liquidated damages or penalty. Your lawyer may opine that if the court finds that it is a penalty then it will award only an amount which would compensate the real damage the employer will suffer. Your lawyer may opine that the agreement is unconscionable, unenforceable, unreasonable, void, illegal, unlawful, coercive, threatening and created to apply force to keep the employee in employment…..

You need to show all documents including but not limited to standing orders of the company, appointment letter, intra company transfer letter, all documents signed by you before leaving for foreign location, service agreement, expenses incurred by company on sending you abroad, revenue/profits generated by you abroad, social security benefits provided by company to you while abroad, your salary slip/CTC sheet while in India and while abroad, increments granted to you while abroad ( or no increment was awarded), appraisal sheets, appreciation emails/letters/awards/rewards, certificates of commendation etc…..

Ands answer a few questions like whether the company kept your PF, Gratuity, ESIC, Group Insurance, Mediclaim policy, etc in force and regular while you were abroad???

--“(Infact it was a intra-company transfer)’

It is strange that company would like to claim expenses incurred by it on transfer of the employee. Transfer and deputation are service conditions and all companies have to foot the bill of relocation of employee. 

--“The actual reason that I returned from onsite was due to sudden demise of my mother.’

This is a justified reason.

Family and parent are first. Company comes later.

--“Now my father's health condition also in a worst condition and I have to take care of him.”

This is a justified reason.

Family and parent are first. Company comes later.

If the company declines to relieve you on this ground in writing it can be pulled up.

Are you aware if you deny to take care of your parent/maintain your parent, your parent can sue you.

---IT companies are covered under SE act of the state in your case AP.

SE Act of AP is so employee friendly.

Look into:

47. Conditions for terminating the services of an employee, payment of service compensation for termination, retirement, resignation, disablement, etc., and payment of subsistence allowance for the period of suspension

(3) Every employee who has put in a continuous service of not less than one year shall be eligible for service compensation amounting to fifteen days average wages for each year of continuous employment, (i) on voluntary cessation of his work after completion of 60 years of age, (ii) on his resignation,

So as per this clause you are entitled for this amount.

If employer has mentioned Gratuity in your CTC sheet you may stake a claim for Gratuity even if you have not completed 5 years of service.

PLS REMEMEBER TO ISSUE A COMMUNICATION IN WRITING  (UNDER PROPER ACKNOLWEDGMENT WITH A COPY TO YOU) ADDRESSED TO GOOD OFFICES OF APPOINTING AUTHORITY, MD THAT COMPONAY MAY DEDUCT EMPLOYEE’S CONTRIBUTION OF  PF AND GRATUITY FOR ALL YEARS OF YOUR SERVICE ABROAD and add the PF contribution of Employer and deposit funds in your PF account. (You may add that you have been requesting in person for it in office.)

If employer has not been deducting and depositing PF (Gratuity: only employer has to deposit) this communication from you shall help you to regularize your PF account and accumulate funds.

You may visit a competent and experienced labor consultant/service lawyer at your location. Labor law/service law is altogether different specialization/field. In each city there are few/limited labor consultants/service lawyers. They are experts in this field, they are well known, and they take up only such cases. Some of them may have their preference to take up employer side or employees side cases.

If you wish to consult a LCI lawyer specializing in this field you can conduct search at:

https://www.lawyersclubindia.com/lawyers_search/#.UUVSq0pFZ_4

Your near and dear ones can also recommend a good lawyer to you.

You have to firm up the terms etc with your lawyer on your own.

Valuable advice of learned experts/members is sought.

Thank you very much for the detailed reply. Actually I have not completed my bond period.  I think I should have mentioned clearly while posting. Sorry about that.  It is mentioned as minimum 12 months after returning from onsite. i.e. Oct  2012 I returned and my bond period is upto Oct 2013.

Please advice.

Have you ever tried to convince your employer for pro rated payment based on actual expenses by the employer than based on liquidated damages of Rs.3Lac????

Have you tried verbally only or have you submitted any such contention in writing?

What is the response of the company? Is it verbal or in writing?

Does it agree to calculate pro rated damages based or actual cost ( if any) or even liquidated damages of Rs 3/Lacs amounting to say Rs.1/Lac for balance 4 months??

A written communication on your part may be deemed as evidence of acceptance on your part.

It is felt that if you have not stated anything in writing you may hold and let your lawyer decide whether any such communication in writing should be submitted or not and if at all it is to be submitted let your lawyer draft and structure it to suit you in the long run.

The company may claim that you had signed the agreement by your free will.

While you have worked abroad for 3 years and 1 year in India would make it 4 years from date of signing the agreement.

It is reiterated that the ground and reason for creating the agreement e.g: employee was beneficiary of any special favor, concession, training at the full/part cost of employer or not….and based on such reasons was there any breach of the service agreement/undertaking signed by employee………..and due to breach of the agreement by employee ……any damages suffered by employer…. legal injury suffered by employer…….should be looked into by a competent and experienced labor consultant/service lawyer-law firm specializing in such cases.

If employer provided any training was it increase the productivity of the employee in the company and for the company……was it on products, strategies, processes, marketing plans of the company,….was it required to run the machine of the company….etc.

If at all mater lands up in court, the courts can assess and decide the reasonable cost which won’t be higher than the amounts expressed in agreement. The court may decide that the mitigating the cost of damages is not necessary……..

You may understand the Sections 73, 74 of the Indian Contract Act and the implications in your case.

It shall be appropriate to show standing orders of the company, appointment letter, service agreement of current employer, offer letter/service rules of Govt. job e.g. any condition on producing relieving letter from past employer etc…… all documents and give inputs in person and proceed under expert advice of your lawyer. Is there any clause on arbitration in the agreement??? You must not conceal anything from your lawyer.

Your lawyer may suggest mediation, conciliation, arbitration, to arrive at a win-win situation for both the parties.

Your lawyer can guide you on the implications of any dispute on the prospects of Govt Job.

Let your lawyer’s opinion be final on the points discussed above.

Valuable advice of learned experts/members is sought.