Technical qualified employee signed unfair agreement

A technically qualified person has signed service agreement that after leaving service neither he can join any other firm of same activity, nor can start any business of similar nature for one year. Company is engaged in Green building certification consultancy work. There is nothing confidential in nature. nither it is patents nor any secrecy. Its a kind of science which is openl awailable in book. Company itself 5 years old and employee has served two years during which company made substantial growth. Technically qualified person is will either join similar consultancy company or will start his own venture in the line of service in which he is qualified. In other words such employee will be like a bonded worker his life time. Doesnt this amount to hitting fundamental right of employees. In such companies there is nothing like patent, copyrights or designing. I need opinion that how such company should be reponded on on notcie which deprivate employee to earn livlihood after leaving the job and how not to be vicimised from becoming bonded worker.




You have posted that:


A technically qualified person has signed service agreement………….that after leaving service neither he can join any other firm of same activity, nor can start any business of similar nature for one year.


What is the period of service agreement i.e. for how long the employee in question has agreed to serve the employer with whom employee has signed this agreement?



Are you separating before the completion of such period stated in the service agreement?


In such companies there is nothing like patent, copyrights or designing.”



If the mater lands up in court of law then court of law shall decide on this…………………



I need opinion that how such company should be reponded on on notice……………………….“



You may show the job advertisement, interview call letter, offer letter, appointment letter, and service agreement/bond, legal notice if any etc to a competent and experienced labor consultant / service lawyer specializing in such matters and proceed under expert advice.


A trained legal eye and trained legal mind that has examined all statements and clauses verbatim and the merits can advice you best ……………….


Lawyer well versed with such matter can provide fitting reply to notice issued by the company. The matter may get closed.


The companies use words and phrases to imply that everything stated in the agreement is legal and lawful until it  is declared illegal and unlawful by a court of law…………………….



The court of law may feel it to be pleased to term such contentions unconscionable, unreasonable, void,………………..




Such language does succeed in exerting pressure on employee as employees are usually fearsome, ill informed, apprehensive and unwilling to seek legal opinion as they conceive that they may get branded as litigant…………………………………….Employer do take advantage of the situation………………..



Generically speaking: Employee can not be restrained to join any other employer after separation and non compete clause amounts to restraint of lawful profession.


An agreement, which restrains anyone from carrying on a lawful profession, trade or business, is void to that extent. Under section 27 of the Indian Contract Act, 1872 agreements in restraint of trade are void.



Indian courts have consistently refused to enforce post-termination non-compete clauses in employment contracts, viewing them as "restraint of trade" impermissible under Section 27 of the Indian Contract Act, 1872, and as void and against public policy because of their potential to deprive an individual of his or her fundamental right to earn a livelihood.



However if the employee has signed an agreement to serve for a specific period then this period , and  clauses on “Trade Secret’ ‘Confidential Information’ ‘Privavcy and Confidentiality ‘ ‘Database’ ‘Non Disclosure’ ‘Non Solicitation’ may stand as an exception and, its validity, may be upheld in post employment period or for a reasonable period.



Company may claim copyright in its ‘Database’ and it to be considered as ‘Confidential Information’ and may scream for ‘Protection of Confidential Information’.


Check with your lawyer if at any point of time Section 72 of the Information Technology Act, 2000 that deals with breach of confidentiality and privacy can be invoked in your case…………?



At the same time an action for breach of confidence succeeds only if the Plaintiff could identify clearly, what was the information he was relying on and has to be shown that it was handed over in the circumstances of confidence and could be treated as confidential.


It shall be appropriate to show your documents and record to a competent and experienced labor consultant/service lawyer/law firm, specializing in such matters, give inputs in person…………………….


The lawyer that has seen all documents and has analyzed the merits can advise you the best, and let your lawyer’s opinion be qualified and final.


You may proceed as deemed fit at your end.


Valuable advice of learned experts/members is sought.





Attached File : 525371383 417759075 validity of employment bonds.pdf, 525371383 background paper.pdf downloaded 68 times

Dy Director

elaborated in details by Mr Kumar Doab.




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