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rajesh (er)     30 June 2014

Non competent agreement

HI ,

I am planning to leave my current employer ,though I have not signed a non competent agreement ,they are forcing me to sign one.

During my tenure with the employer ,I was supplied to another company abroad  ,as they do man power supply .The company abroad deputed me to their client which is also abroad .So there are three parities involved .The first party is my current employer in India,second party is the company to which i was supplied to and the third party is the second parties client.Both second and third parties are located abroad.

There are no direct ties with the first party and the third party .

Even though I  sign a non competant agreement with my employer ,will it stop me from gaining a direct employment with the third party as there is no visible business between first and third parties .And will this agreement hold as the third party is at abroad.

 

Please help me on this.

 

Regards

Rajesh



Learning

 5 Replies

Kumar Doab (FIN)     30 June 2014

In such matters it is always advisable to  spend quality time with a competent and experienced labor Consultant/Service Lawyer-Law firm more than once, show all docs on record, and understand the merits.

 

 

>>> Employee is under NO obligation to sign any agreement with any employer.

 

You can straightway decline in writing on record.

 

It shall be appropriate to record (audio/visual) all transactions now.

 

In case the employer resorts to tactics, coercion, pressure then only the irrefutable evidence shall be of help.

 

    

>>> Non Compete; Indian Courts of law have consistently been declining to award injunctions, and enforce Non Compete Clauses/agreements post termination of employment as it hits the right to earn livelihood and clauses of Indian Contract Act.

 

This is not being said of courts of law  abroad.

 

The language…………..verbatim of the agreement should be analyzed by a lawyer/law firm specializing in such matters.

 

The agreement might have statements/clauses on Non Solicitation/Data Protection/Trade Secrets etc that might have reasonableness and might be enforceable for reasonable period o time.

 

Your employer might have signed some agreements………………….e.g………………Non Compete………..NON Poaching……………with 1st/2nd establishments to which you were seconded………………hence to safeguard its interest it needs some one to transfer the onus………………………………..

Hence it won’t let you go easily without signing the agreements being demanded by it.

 

 

 

 

 

 

Many events might be possible there you should prepare now and prepare well for the events that might be possible.

 

Build record and maintain record.

 

Keep a good lawyer by your side.

 

Most Imp. is that you should have a committement from next employer that might benefit from you that it shall not terminate you in case of law suit by past employer…………………….

 

You should put the clauses and agreements cited by you on record to next employer………………..and have its concurrence to accept/absorb you even in case of such clauses……………..

 

Defend your interest in the best possible manner…………

 

 

 

rajesh (er)     30 June 2014

Thanks Kumar for your reply ,I confirmed with the third party ,they don't have any business links with the first party ,one more question is even though  I sign such an agreement .Will such an agreement stand for a party not in India?.

Thanks for any comments in advance

Kumar Doab (FIN)     30 June 2014

 

 

You should not sign such agreement.

 

Record all transactions now (audio/visual).

 

Build written record and mention that NO Tasks are pending at your end, highlight commendations, increments,Tgt.Vs Perf., KRA’s, appreciations, incentives and that NO stinker/Notice/show cause/notice etc has ever been issued to you, and you have displayed highest standards of integrity, character………………….and include that you are being forced to sign an agreement titled as……………………….and Mr/Ms…………..designation………………name of company……………….on  dated………..at address………………. have refused (if true) to handover the copy of such titled paper to be taken by you to study……………………for consultation and advise……………………and that it is not part of your service conditions to sign any agreement without your free will…………………and it has been announced to you that if you don’t sign……………………. .following penultimate steps by company shall be taken……………..e.g. adverse comments in reference check/BGV, non acceptance of resignation, non issuance of service certificate/relieving letter, FnF statement , FnF wages, Form16 etc…………………………(if true)………

 

You may show the job advt, job application, interview call letter, selection letter, offer letter, appointment letter, HR policy/service conditions/service rules and regulations……………mention of which is made in appointment letter, standing orders (Certified/Model), deputation/secondment/transfer order to any other establishment and any agreement signed at that time………………..and other relevant communication that you might have……………………………..agreement that you are being asked to sign NOW…………….. to your Service lawyer/law firm/Labor consultant…………………in person and explain the matter and spend quality time with your lawyer………………..

 

 

Don’t go for generic advice in various portals in such matter(s).

 

There are various agreements signed between countries and attorney’s and Lawyer’s are smart to given suitable flavor to the agreements crafted by them.  

 

The lawyer that has examined all docs and your inputs, in person can advise you the best.

 

I am not sure whether any court of law abroad shall have jurisdiction on any agreement that you may sign with your employer(s) in India!

 

The jurisdiction may involve many laws and public policy standards.

 

Moreover :::::

 

----it is not only the negative or restrictive covenant, its jurisdiction, but you shall be facing tactics from employer and his attorneys……………………………reason being if one employee is let loose then many shall have to be……………………and employer can not sleep easily with such idea………………….hence shall endeavor to set strictest standards and trends for others. You may find it stressful, penultimate.

 

 

----The agreement that you may sign may be so artfully articulated that you on your own may not be able to distinguish NON Compete, confidentiality/trade secret and non-solicitation restrictions buried in it or even………………………. low-touch human resources policy, company rule, code of conduct or employee handbook.

----There might be more complex situations e.g…………..is a cross-border restrictive covenant that implicates two or more jurisdictions’ laws that may trigger a conflict-of-laws problem and how to resolve competing public policies and competing mandatory rules.

 

----The employer may give the language and color of  single-jurisdiction covenants in countries around the world.

 

 

Would you be able to afford attorney’s fee(s) abroad? This may be too high.

The local laws abroad may have many penultimate options.

 

Hence you should safeguard you appropriately by building irrefutable record and evidence.  

 

Don’t forget to inform the next employer(s) the agreements that you have signed and to extract a written committement that they shall not terminate you (employment contract) with you, and shall provide you an attorney without any cost to you/at its cost  if your past employer files a law suit against you or approaches them……………………. By phone calls, written communications……………..

 

 

AND WHY DON’T YOU GET A FREE ACCESS TO ATTORNEY OF FOREIGN EMPLOYER AND SEEK HIS OPINION FORWARDED TO YOU BY FOREIGN EMPLOYER IN WRITING AND TRANSFER SOME ONUS OF FOREIGN EMPLOYER TOO…………….

 

THE INDIAN EMPLOYER TOO MAY NOT BE ABLE TO FACE COSTS AND LEGAL IMPLICATIONS ABROAD WHEN YOU ARE DEFENDED THERE…..

 

 

It is reiterated that you may ‘Keep lawyer by your side’ and defend your interest in the best possible manner.

Kumar Doab (FIN)     30 June 2014

Another point for your benefit that you should take up first with your lawyer/law firm/consultant/attorney is that:

 

What compensation your current employer is offering you for signing Non Compete Agreement for..............................years?

What would and employee do for all these years if he can't work with employer in same trade that employee is skilled in, has experience/education etc?

SELL BHAJIYA......................................OR WORK AT DHOBI GHAAT?  

Ask your lawyer about 'Garden Leaf' clause.

 There are two situations:

1. Your employer or its attornies e.g. HR personnel, Line Managers, Legal cell personnel may claim that you have signed a statement inserted in appointment letter/HR policy/Employee handbook you shall sign agreements/clauses introduced by employer from time to time......................  

2. It is a policy (published/circulated......................unpublished/uncicrulated) that all outgoing employee's have to sign such agreement.

 

Your lawyer would know how to handle both.

You may with absolute confidence  lean on your lawyer to handle the situation without leaving any adverse effect on your future interests.

Ramesh Hanchinal (Manager)     01 July 2014

even though you signed the non competant agreement with your employer, it does't affect to your carrier, as there are enumber of supreme court judgement on such matter. the agreement is null and void.

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