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akshay   07 June 2015

Commitment validity

Hi,

      I am working in a company xxxxxx from 1 year 7 months in India. Actually 6 months back I gave a resignation request in this company as I got offer in another company yyyyyyyy with good salary. But the management in the current working company requested me to stay back in the company as they said that they will pay the same salary to me as offered by other company. But in addition they said that I need to stay in the company for minimum 2 years and they will provide me 20% (8,000 rupees) hike after one year. They also said that if i leave the company in the middle they won't relieve me and also they won't give me any documents. Some how i was convinced to stay in the current working company. But now I am fearing for the clause highlighted above because if time comes to resign due to any unavoidable circumstances in future I will not be able to resign and the company may not relieve me or may ask a huge amount as a penalty.  I just wanted to confirm that is such restrictions valid legally? I am  4+ years experienced candidate.  

Finally but most importantly to say that I did not sign on any bond but it was communicated in the emails.

 



Learning

 12 Replies

Kumar Doab (FIN)     07 June 2015

What applies to you is appointment letter, contract of employment,corrigendum.

 

What huge penalty you are fearing?

 

You may show all documents on record to an able Labor Law Consultant/Service Matters Lawyer/Law firm for a proper opinion.

 

You should provide full information, pointwise!

What is this establishment registered as: Commercial,Industrial?

What is its line of business:IT,ITeS,banking etc?

How many maxmimum persons are employed in it at any point of time?

The Redg Office,Corporate Office of the company, and your reporting office was located in which state?

 

What was your designation and nature of duties?

Do you have leave policy, HR policy,Service Rules and Regulations,Conduct and Discipline Rules that are mentioned in the appointment letter?

 

Was any appointment letter,salary slip of each month,PF number with a/c slips,ESIC card,Form16 given to you?

 

Are you a member of any employee’s/Trade Unions?

What was your monthly salary?

akshay   07 June 2015

Its an Software company. Maximum number of people in company are 120. Company is located in Karnataka but also has branches in other states as well. But the head office is in karnataka.

My designation is Software Engineer and I am a Software developer.

We do have leave policy, HR policy but not mentioned in appointment letter.

I have received appointment letter after 2 months of joining the company and I do receive salary slip of each month, PF is optional in this company ,there is no ESIC card given to me, Form16 is not given to me yet.

I am not a  member of any employee’s/Trade Unions.

My monthly salary was approx. 30k before resigning and they made it approx. 40k after that.

Kumar Doab (FIN)     08 June 2015

You have not replied to:

What huge penalty you fear?

 The appointment letter, HR policy, resignation submitted by you, offer made by company, email exchanged by you should be examined verbatim.

 

The company seems to have made a stretched offer to give 20% hike in salary after 1year. Did you withdraw your resignation in writing? Was this 1 year from date of withdrawal of resignation?

 

Salary slip has to be supplied to all employees. PF/ESIC has to be provided to all employees covered by the Act. If you are say not covered but company provides PF coverage you should avail it.

Appointment letter should have been given as per Sec;6A of Karnataka Shops and Commercial Establishments Act. Company has committed violation.

What is the notice period inserted in appointment letter and subsequent emails?

You should be a member of IT/ITeS Employee’s/Trade Unions!

You may show all documents on record to an able Labor Law Consultant/Service Matters Lawyer/Law firm for a proper opinion.

 

akshay   08 June 2015

I fear that they should not ask back all the money given as a hike if I need to leave the company in the middle due to some reasons.

Yes I did withdraw my resignation in writing. And Yes I will be getting a hike of 20% (8,000 rupees) after one year from the date of resignation withdrawl.

Notice period in the company is 45 days and is mentioned in appointment letter. No matter related to notice period has been mentioned in subsequest emails.

Yes I will make my step in becoming member of IT/ITeS Employee’s/Trade Unions.

 

 

Kumar Doab (FIN)     10 June 2015

It is good that you have decvided to become a member of employee's unions. Beter join trade union also.

 

You require it to become properly informed.

 

You were to be given a hike of 20% (8,000 rupees) after one year from the date of resignation withdrawl.

Do you think that you negotiated a good deal?

ON the contrary company/employer negotiated a good deal! They achieved it as you were not properly informed.

 

Your counsels may opine that notice period may not be more than 30 days..............and wages once paid can not be taken back.

 

 

 

1 Like

akshay   13 June 2015

No I don't think I negotiated good deal. It's not only about money but also the fear about the career goals. I just feel that I would have not agreed to such clauses in email which states :

"As per commitment, you should stay for minimum 2 years effective from 25-Nov-2014, in-case in between if you break this rule, we won't relieve you & also you won't get any documents." 

The clause is really making me fearful. Is there anything wrong if I say to my reporting manager that "I withdraw from agreeing with such clauses. I am not resigning now. I will continue to work in company but without any conditions of staying 2 years in the company. I will work as long as everything goes fine. But in case if time comes, I should be able to resign and get relieved from the company after serving the notice period." 

Can the company really impose the fine on me if I need to leave the company in the middle of commitment period. If they can impose the penalty on me then what could be legal reason behind imposing the penalty? And can they hold my documents and relieving letter?

Kumar Doab (FIN)     13 June 2015

 

You have posted that:

----"As per commitment, you should stay for minimum 2 years effective from 25-Nov-2014, in-case in between if you break this rule, we won't relieve you & also you won't get any documents." “

What committement and in lieu of what?  Is it stated in writing?

Rest of the statements does not seem to be legally enforceable, as employee can not be forced to work and be relieved (bonded labor has been abolished long back) and service certificate has to be supplied to each employee.

 

----“ "I withdraw from agreeing with such clauses. I am not resigning now. I will continue to work in company but without any conditions of staying 2 years in the company. I will work as long as everything goes fine. But in case if time comes, I should be able to resign and get relieved from the company after serving the notice period.”

 

If company has already awarded an increment then you may have the risk of facing termination. If company has bachtracked from any committement made by it then you have a reason to cancell.

Let any of your communication be drafted by your counsel that has seen and examined all docs on record.

 

Beyond this if you have any legal issues you may approach an able Labor Law Consultant/Service Matters Lawyer/Law firm and proceed further under expert advice of your lawyer.

 

1 Like

akshay   16 June 2015

Thanks a lot to Kumar Doab Sir for providing all the legal information to me and relieving my stress.

To answer your question below is the full mail sent by my manager to me in response to my resignation letter:

 ---------------------------------------------------------------------------------------------------------------------- 

Hi Akshay,

Thank you for considering my request to continue working in our 
organization for another Two years effective from 25-Nov-2014.

As per our discussion, you will get a hike of amount Rs.12000 effective 
from 25-Nov-2014, after one year you will get a hike of 20%(Rs.8000) on 
25-Nov-2015.

You will receive a hike amount interns of performance incentive for six 
months, after six months that amount will be included in CTC, same 
pattern will follow for next hike also.

As per commitment, you should stay for minimum 2 years effective from 
25-Nov-2014, in-case in between if you break this rule, we won't relieve 
you & also you won't get any documents.

if you are OK with this, Pls send a confirmation mail by withdrawing 
your resignation to me, based on your confirmation, i will check with 
management & revert to you.

for any clarifications, Pls discuss with me.

Regards,
xxxxxxxxxxxxxxxx

 ----------------------------------------------------------------------------------------------------------------------

My resignation withdrawl mail was as below:

 ----------------------------------------------------------------------------------------------------------------------

Hi Sir,
           I here by withdraw my resignation request and stick to my 
commitment of staying minimum 2 years in the company and I am happy with 
the offer offered to me. I thank all for considering me as a good 
resource and showing interest to retain me in the company.

Thanks,
Akshay

 ----------------------------------------------------------------------------------------------------------------------

 

 

Kumar Doab (FIN)     16 June 2015

Don’t make committements if you can’t fulfill.

You have posted that:

 

“As per commitment, you should stay for minimum 2 years effective from 
25-Nov-2014, in-case in between if you break this rule, we won't relieve 
you & also you won't get any documents
.”

The only penalty that seems to be as per the extract posted by you is shown in red.

There does not seem to be any liquidated damages/financial implications.

Hence if you tender full notice period and serve it or tender notice pay in lieu of it as per appointment letter issued to you and enactments applicable to you e.g. Karnataka Shops and Commercial establishments Act,  Model Standing orders and submit company’s assets/handover of charge under proper acknowledgment and leave nothing pending then company legally should not be able to claim that you have anything due hence can not be relieved. Service certificate, acknowledgment of notice/resignation, form16,salary slips of each month,NOC/NDC, FnF statement,FnF statement ,payment of FnF dues, relieving letter,  would be our right.

 

The state of Karnataka has made it mandatory to have GRC in each company.

There are various IT/ITeS employees unions that have done good job and trade unions like CITU,INTUC,AITUC,BMS etc are willing to embrace them.

If you are unable to resolve taka  help of your counsels.

 

1 Like

akshay   16 June 2015

Hi Kumar Doab Sir,

            Thanks for your information. Information provided by you helps me a lot. Lastly I just wanted to clarify that is this a typo whatever you posted in last message: "The only penalty that seems to be as per the extract posted by you is shown in red." As nothing in the post posted by you is in red. I guess It's a underlined words. Am I correct?

 

Thanks,

Akshay

Biswanath Roy (Advocate)     17 June 2015

Agreement itself is clashing with and encroacment upon your FUNDAMENTAL RIGHT guaranteed under Article 14 of the CONSTITUTION OF INDIA which makes the service contract Ab-initio VOID.

1 Like

Kumar Doab (FIN)     17 June 2015

 

Yes, It is underlined.

Make sure that whenever you separate by resignation mention that NO Tasks are pending at your end (keep evidence) and that routine duties be assigned that can be completed on day to day basis within and upto expiry of notice period tendered by you i.e. dated……………………..and to whom you should handover the charge/assets under proper acknowledgment on the spot.

 

This discussion in this thread may not deter the employer to notice you or even pull you to court of law.

Hence build sufficient favorable written record while in employment and preferably proceed further under expert guidance of your able Labor Law Consultant/Service Matters lawyer/Law firm.

 

Your employer can also  take many steps to trouble you.

Wish you the best.

 

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