Not work in similar company
Mangesh
(Querist) 23 January 2014
This query is : Resolved
Dear Experts,
I had work with one fertilizers company as a Accountant, while joining service company made service agreement which includes after resignation you will not work in similar company at least 5 years. Company force me to give me resignation and now i am getting job in fertilizer company but first company issue letter me that i have not do work in similar company at least five year. please suggest what can i do. As any company hire employee who has a experienced in similar company,
Thanks in advance
Kumar Doab
(Expert) 23 January 2014
Indian Courts of law have consistently been declining to enforce Non Compete clauses/agreements as it hits right to earn and livelihood and clauses of Indian Contract Act.
5 Years by even wild imagination is unreasonable.
However you have posted that you have signed many agreements therefore it shall be appropriate to show the many agreements you have signed to a competent and experienced labor consultant/service lawyer specializing in such matters.
In addition to Non Compete clauses/agreements you might have signed amongst many agreements Non Solicitation, etc too.
Do you have the copy of many agreements signed by you?
You should have consulted your lawyer while you were being forced to submit resignation.
Your lawyer would have structured and drafted your representations so as to transfer the whole onus on employer for breach of agreements crafted by it and thus would have declared him as unworthy of being employed with.
Extracting resignation by force is offence and can be termed as deemed termination.
Next time before signing on the dotted line consult your lawyer in advance.
V R SHROFF
(Expert) 23 January 2014
Contract is enforceable.
As accountant, you may join diff type of co.
Devajyoti Barman
(Expert) 23 January 2014
Yes, there is no restraint for joining in new company.
Rajendra K Goyal
(Expert) 23 January 2014
You are bound by the agreement signed by you.
Kumar Doab
(Expert) 23 January 2014
This is an interesting thread. Valuable advice of learned experts shall help many fellow citizens and employees who had to sign such Non Compete Clauses/agreements..................
The querist has not responded to what other agreements/contract has been signed by him?
It is believed that the querist has not signed any service agreement/Bond with employer.
5 Years by even wild imagination is not a reasonable period.
It may fail to satisfy the criteria for ‘Reasonableness’.
Non Compete Clauses/agreements may very well remain in force during period of employment.
Post termination of employment/contract of employment Non Compete Clauses/agreements shall deprive a citizen from his fundamental right to earn a livelihood........................ It hits Indian Contracts Sec27 is viewed as restraint of trade and Indian Courts have consistently been declining to enforce such clauses/agreements.
Right to earn a livelihood is inviolable.
Non Compete Clauses/agreements post termination of employment may get termed as invalid, Unenforceable, unreasonable, unconscionable, unfair, void.............
Learned experts are requested to provide insights and illustration on ‘How this contract is enforceable and why an employee shall have to abide by such contract created by employer for employee to sign.
This shall help many.
Advocate. Arunagiri
(Expert) 23 January 2014
Normally the companies will not insist an accountant for the non compete agreement. The will insist this for technical experts.
For the accountants, the company will insist for non disclosure clause.
I think the querist has to come with more details and facts, enabling us to give a right opinion.
prabhakar singh
(Expert) 23 January 2014
VERY STRANGE QUERY? INDEED THAT TOO FOR 5 YEARS BAR ON AN ACCOUNTANT.
prabhakar singh
(Expert) 23 January 2014
DEAR SIR CAPTAIN V R SHROFF!
HELP ME PLEASE GET DELETED SIR!
V R SHROFF
(Expert) 23 January 2014
accountant knows in and out of business.
technician only know part of the process/ mfg/ , and can be hired.
Accountant have direct connection with supplier, pricing, sellers marketting, and in all cases, it certainly harm the business.
a jr advocate start practice in the area of his senior, get 75% business (sorry, profession & not profit) of the Senior. He is cheaper, hard working, inviting!!
So is the ACCOUNTANT, PAID DOUBLE BY COMPETITOR TO USE HIS CONFIDENTIAL KNOWLEDGE.
sO NOTHING WRONG BINDING SUCH KEY MANAGERS FOR 5 YEARS. hE IS NOT WORKMAN..
R U SATISFIED SHRI PRABHAKAR SINGH.JI.. .
Kumar Doab
(Expert) 05 February 2014
The querist has pointed out ........... that he has signed only one agreement at the time of joining.
In his query it is posted that “while joining service company made service agreement which includes after resignation you will not work in similar company at least 5 years. “
The Non Compete Agreement is valid during the term of employment.
Indian Courts of law have consistently been declining to enforce Non Compete clauses/agreements:::: After termination of employment.
The querist may join any company (ies) in similar trade.
However it is reiterated that it shall be appropriate to show the ………. One Agreement that he has signed to a competent and experienced labor consultant/service lawyer specializing in such matters.
Guest
(Expert) 05 February 2014
Dear Kumar,
My views are a bit diffetrent. Non-enforcement of the non-compete agreement depends from case to case basis depending upon the issue of resigntion by the employee or termination by the company.
If an employee tenders resignation at his own volition, the non-compete agreement would prevail, as the intention becomes clear that the employee has resigned just to get some financial rewards from some other similar company at the cost and secrecy of his previous company for sharing the secrets of the company or to share the information about clientele of his previous company.
So far as termination by the company at its own initiative is concerned, the company ethically loses its right to enforce the agreement.
