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Jayanta (Service)     11 March 2021

Execution of employment bond

Just received an joining offer from Start Up at a very small CTC-Rs.3 Lakhs.

The employer mandatorily wants execution of Employment Bond for 2 years- First of all they are taking advantage of Covid scenario and a poor package. This is a Private and Start up company.

Is it legally binding -even if one is forced to sign the Bond.

Kindly guide 



Quick Summary
This discussion explores the legality and enforceability of employment bonds, particularly in the context of a startup offering a low salary. While some argue that such bonds are often invalid under Indian law, especially when not tied to specific training costs, the advice given suggests that while signing might be required, any illegal clauses within the bond should be challenged. The consensus leans towards employment bonds being generally unenforceable unless specific training investments are involved.

 2 Replies

avadhesh Paliwal   13 March 2021

YES YOU HAVE TO SIGNED THE BOND .....BUT THERE SHOULD NOT BE ANY SCRIPT IN BOND WHICH IS ILLLEGAL....PLEASE SHARE WITH ME THE BOND WRITTERN DOCUMENT 

Ritesh Maity (Labour Law Advocate)     14 March 2021

Employment bond is not valid as per decisions of the Hon'ble Apex Court. It is also prohibited in terms Sec 27 of the Indian Contract Act. Such bond may be executed only when an employee is given any special training for which the employer has to incur additional cost apart from CTC.


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