What steps to take for absconding employee

file civil suit

This is an interesting discussion. The Forum is for healthy discussion and to dwell on the subject in the tread.

The following is heartfelt opinion only and is not authoritative or commanding or a final advice and is not aimed to offend or argue.

Valuable advice of learned experts/members is sought. It is requested that the discussion may kindly be taken further with tangible and prudent comments.

You have posted that:

--“That in the event of the Employee leaving the services of the Company before the Expiry of the period of the Contract, as also in the event of the Employee making it obligatory or necessary or expedient on the part of the Company to terminate his/her services for any reason of whatsoever nature and for all things, the employee shall be liable to pay and shall pay to the Company a sum equivalent to Two Calendar Months (present salary) by way of agreed liquidated damages and the Employee agrees to pay the same without any proof of actual damages suffered by the Company being required to be produced.”

Even if the company terminates the service instead of company tendering notice pay employee shall tender two month’s pay. Company does not need to tender any proof of expenses incurred/suffered by it. 

The employee has to submit an undated cheque.

The question arise can such a clause and condition in contract of employment stand the test of law???

Is the cheque against a dischargeable debt?

{ MERE USE OF WORDS "LIQUIDATED DAMAGES" AND "PENALTY"' IN A CLAUSE NOT TO BE DECISIVE. The parties who use the expression `penalty' or liquidated `damages' may prima facie mean what they say, yet the expressions are not conclusive.  }

Is such a practice legal or is this practice illegal, unfair, bad, unethical…….and punishable????

If such a practice is permissible then won’t it be better to ask the employee to mortgage the family house, in favor of the company.

In times to come companies may start asking to pledge the family jewels in the name of the company as losing the family jewels is considered utmost shame in society and hence employee shall come running with his entire clan to take back the family jewels.

Such contracts are apparently crafted by an expert of the company as per specifications given by the company. The expert who has crafted this contract is best placed to advice further whether to file a recovery suite, case under NI act, criminal complaint with police to lift and imprison this employee and thus shove the arm down the throat to squeeze the money out of the employee.

It is felt that companies which are into such practice shall subject the employee to a drill of tactical actions aimed to subdue the employee to surrender to the tantrums of the company and the employee does not approach a lawful authority.

“stay away from any company that asks for a "security deposit".

It is felt that candidates should be good enough to understand that such contract shall be too demanding, coercive and shall lead to exercises of pressure and candidates should walk out of the interview and leave the recruiters gaping.

The campus placement exercises are going on. If it is done from this year it shall have an impact from this year.

With limited understanding it is felt that it shall be better to close such matter to the issue of notice of employee and speculate on the reasons why employee{s} do not stay despite the so called and so stated training in the contract of employment and despite that companies collect deterrents like undated cheques.

Apparently the environment is like that employee can not stand”

“Give Cheque , Take Job”

The attached Article is although perturbing, but it is a steek comment on present day situation, and is thought provoking.

The Labor minister had to state that the govt. shall look into the matter. Karnataka has ended the blanket exemption from IESI act and within 6 month’s the companies should frame their standing orders.

Some court judgments on undated cheques which may set the course for discussion are also enclosed.

The learned experts/members may find conditions in Singapore interesting:

https://www.mom.gov.sg/foreign-manpower/passes-visas/work-permit-fw/before-you-apply/Pages/security-bond.aspx

The security bond is signed between the employer and the Government. The Foreign Worker is not required to pay the security deposit.

Conditions of Security Bond

• During the Work Permit holder's stay in Singapore, the employer is responsible for the prompt payment of salary and the costs of his upkeep and maintenance, including medical treatment.

And materials at following thread interesting:

https://vfxsoldier.wordpress.com/2012/07/25/prime-focus-exploiting-indian-workers/

https://forum.murthy.com/index.php?/topic/12228-employer-denied-to-return-security-deposit/

The Agreement as described in the query, is illegal and void. Any term or terms of an employment agreement binding an employee, stipulating such unfair terms contrary to law will be void to that extent. In this case the employee is said to be employed in Chennai and therefore, the Tamil Nadu Shops & Establishment will apply. This Act does not permit any such recovery by liquidated damagers or otherwise hence any terms of agreement executed between the employer and employee shall be contract to the provisions of this Act.

Vasudevan

The word absconding is derogatory and objectionable.Employees are not bonded labour and they are at liberty to leave employment.The bond in question is unequitable and illegal.It gives power to employer to recover two months salary even in cases of termination and the employer is the sole judge to decide justifiability of termination.

Such bonds are generally taken to recover the cost of training abroad, when employee leaves service in breach of contract.

The contract in queston can not be enforced in court unless actual damages are proved.

@ Author 

1. Bonded Labor is illegal in india .

2. He is not your slave . 

3. You have forceably abstracted a cheque from him which is wrong on your part .

4. You have deposited the cheque after filling the details like date and Amount which renders the same invalid without taking the consent of the party who gave you the cheque .

5.              87.Effect  of  material alteration:

Any material  alteration of a negotiable instrument renders the same  void as  against any one who is a party thereto at the time of making  such alteration  and does not consent thereto, unless it was made in  order to carry out the common intention of the original parties:

Alteration by indorsee _   And  any such alteration, if made by an indorsee,  discharges his  indorser  from all liability to him in  respect of the consideration thereof.

The  provisions  of  this section are  subject  to  those  of sections 20, 49, 86 and 125.

The employee  issued a blank cheque without mentioning the date and amount– Act of complainant in filling up amount portion and date was a material change and it could not be enforced even though it was issued for a legal liability – Alteration without the consent of the party who issued the cheque rendered cheque invalid.