Provision relating violation of service agreement
indu
(Querist) 18 August 2012
This query is : Resolved
DEAR SIR,
my client is a pvt. ltd. firm dealing in software programming & web site designing. when my said client employs the employees it takes a job agreement signed by the employee on a 10 rupees non judicial stamp paper. in which it is described that the employee shall work with the company for two years and if the employee terminates his job without giving one month notice he shall be liable to pay rs. 1 lac to the employer for the breach of job agreement. now pls guide me if this agreement is valid and if yes then what remedies are available to the company in case of any employee breach the terms of job contract.
thanks
Devajyoti Barman
(Expert) 18 August 2012
The agreement is not valid on the ground of of being unconscionable.
It will have to justify the hefty amount for breach of agreement which would not at all be easy in the court of law.
ajay sethi
(Expert) 18 August 2012
if the Service Agreement provides for liquidated damages etc. in the event of employee leaving the service before expiry of period of 2 years such an amount can be recovered from employee by the employer.
has the company spent any amount on his training?
ajay sethi
(Expert) 18 August 2012
In Toshnial Brothers (Pvt.) Ltd. v. E. Eswarprasad & Ors., 1997 LLR 500 decided by the Madras High Court. In this case, an employee who was engaged as Sale Engineer committed a breach of the undertaking when he left the services of the plaintiff after serving for 14 months only as against the contracted period of three years. When the case reached the High Court, the High Court of Madras held that in such a case, it becomes unnecessary for the employer to prove separately any post-breach damages. On the other hand, it would suffice to substantiate the fact that the concerned employee was the beneficiary of special favour or concession or training at the cost and expense wholly or in part of the employer and there had been a beach of the undertaking by the beneficiary of the same
Attribution: http://www.citehr.com/185840-court-judgement-service-bond-liquidated-damages.html#ixzz23tfis2XY
