Mohan suthar (Engineer) 23 November 2014

Force to seve notice period for contractual employee

Sir,I joined as an engineer in a railway PSU in May 2014 as a contract employee for one year.In the appointment letter it was mentioned that contract can be terminated anytime by either side by giving notice period of three months or salary in lieu thereof..
In addition to these they were deducting 20% of my salary per month as a security which will not be released in case of premature resignation.

I have been selected in other organisation as a permanent employee and need to resign soon without serving notice period. Kindly advice and suggest me the indian law/judgments or ways to handle it legally correct.
**Till now i have not been assigned to any work officially.

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2 Replies

Kumar Doab (FIN) 23 November 2014

If you were appointed by a contractor then the contractor might have registered under (Name of the state) Shops and Commercial Establishment Act and you might be covered by the def.of Employee as in the Act. If yes the notice period/pay should be governed by this Act and might be NIL as per length of service or max.30 days... The standing orders (model/certified) might also be applicable.In such case notice period/pay during probation period is NIL and 30 days after confirmation. In some states commercial establishment are covered by standing orders otherwise the establishment might also be covered as per Payment of Wages Act... No deduction other than those defined in above mentioned Acts can be made from earned wages..... Your Labor Law Consultant Service matters lawyer may opine that you are covered, and 90 day notice period/pay,deduction of 20% security deposit is not applicable... If you are employee of Railway you may pursue service rules of Railway applicable to contract employees...

Mohan suthar (Engineer) 23 November 2014

I am working as a contract engineer in a public sector unit under ministry of railways.Please advice how to proceed in such circumstances.is only buying out notice period and left the security money the option left for me?