Hello Sir/Madam I run a startup that is into Web Designing and other associated services. I am facing a unique problem that is a mix of professional and personal issues. The issue is with two senior most employees (Founding members) of the firm. 1: Two of these employees (one male and other female) are of 23 years of age. 2. The male employee (hereinafter referred to as A) is a co-founder. 3: The Female employee (hereinafter referred to as B) is a fresher who was recruited on November 2014 as a Web Developer A was the direct supervisor of B and their professional relationship turned personal and they both fell in love. B is a brilliant employee and both A & B is strictly professional in Office and they strictly adhere to all the policies setforth by the firm. B has raised the affair to her family and due to cast mismatch her family is against their relationship and is forcing B to resign from the firm whereas B has no intentions to resign. B has requested the company NOT TO ACCEPT her resignation if by force she is made to tender one and has also requested the company to prepare a bond for her that requires her to work with the company for 1.5 years. Both A & B would like to marry but only after a couple of years as they need to get financially settled. The parents of A are completely fine with the relationship where as B's family is trying all sort of emotional blackmailing and forcing B to quit. As a friend and a CEO, what should I do to solve the issue? The company wants B to stay as she is a brilliant asset to the firm and we have already invested some amount for her training. Help on this matter would be greatly appreciated. Regards
1)if company has invested some amount in training of employee B ask B to execute bond that she wont leave the organisation for period of 2 years .
2) in the bond mention that if she leaves organisation during period of 2 years she will pay the company Rs 10 lakhs being the amount spent on her training .
3) since B is willing to execute the bond it will serve your purpose of retaining the employee and it will help B in continuing to work in the organisation .
1. The core synthesis of the dispute is entirely personal in nature. No legal issue has arisen till now.
2. Did your firm enter into an employment contract with B at the time of recruiting her? What are the terms and conditions of service? Is it silent on the minimum duration for which she is required to work? If the terms and conditions do not stipulate a minimum period of service then you may accede to B's suggestion of executing a bond with her whereby and whereunder she has to work for X number of months or years, failing which she will be required to compensate the company. However, it may be added that if she violates the bond you will have to go to court to enforce the conditions of work which rank sacrosanct.
3. Make an informed decision.
1. As a person or friend you may intervene in the affair and talk to the family members of B so they see reason. it is your duty also towards the society as large.
2. However as CEO you have absolutely no reason to fall into their dispute and try for a solution. If you see someone has breached the Firm's policy or is not discharging his duties you can take action but surely can not go beyond that and for sake of A impose any restriction on her leaving the Firm , more so, if at the time if her recruitment no such restraint clause was there.
She has raised a request to have her sign a Bond with the firm and I have prepared one and has made her sign the same. She has also wilfully signed few white papers for us to help her in case if there arise a need for any document that requires her signature.
Please find below the entire contract that I made her sign.
EMPLOYMENT A G R E E M E N T
FIRST PARTY:
THIS AGREEMENT is made on 15th November 2014 between Miss. B, a resident of India residing at <ADDRESS>
AND
SECOND PARTY:
M/s. <COMPANY> (hereafter referred to as ‘The Company’), a legal entity having its office at <ADDRESS>
WHEREAS M/s <COMPANY> is a service based company that is offering web services such as designing, development and hosting of web and software services but not limited to web development, software development, website designing, web hosting, and digital marketing (hereafter referred to as the ‘Services’) and has also entered into an agreement and may enter into agreement in future.
AND WHEREAS THE first party joined with the second party
As a Web Developer on 9th November 2014 of <DEPARTMENT>, a legally abiding division and brand of <COMPANY> conceived to carry out certain specific tasks and operations and by virtue of her duties with the second party, she will acquire specified knowledge of the operation and functionality of the Company’s Services that may be confidential or proprietary and of know how and technology for the development, design and operation of the Company’s Services. THEREFORE, it is desirous that the first party should enter into an agreement of secrecy and confidentiality AND WHEREAS first party has agreed to execute this agreement of secrecy.
NOW IT IS HEREBY MUTUALLY AGREED TO BY AND BETWEEN THE PARTIES AS UNDER:
1. That the first party shall devote her whole time attention and abilities to the business and affairs of the Company, during the term of his employment with the second party. She will carry out and obey all orders, directions and instructions of the Company and shall conduct herself honestly, faithfully and diligently all times and shall not be guilty of any negligence, misconduct or misbehavior or shall not commit any breach of this agreement.
2. That the first party shall not disclose at anytime during or after leaving the employment, information pertaining to the know how and technology which comes to her knowledge while in service to any person other than only to those employees and officers of the company who are entitled to have such information(s).
Contd…2…
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3. That during her employment with second party and/or on leaving the services, she shall not directly or indirectly be interested in any business, trade or profession similar to the second party and will not accept any employment with companies offering and/or proposed to offer similar services.
4. That all inventions, designs and improvements and all discoveries and secret processes made, discovered or effected by the first party during the period of this agreement shall rest in second party as being sole property of the second party.
5. That the first party agrees to work with the second party for at least 1.5 years and shall not leave the services of the second party during the period of next one and a half years except in the case of continued ill-health in which case she can leave the company by giving three months prior notice or payment in lieu thereof.
6. That the first party agrees that in case she leaves the company during the period of this agreement, she undertakes to refund 50% of the gross emoluments paid to her during the period she remains in service in the period of this agreement in addition to cost incurred to the company for training, transportation, facilities and recreation of the first party and any other damages and/or losses suffered by the second party. The amount of refund shall be determined by the second party and shall not be open to any question by the first party.
7. The first party agrees that even after leaving the service, she will not involve herself and/or join service with any of the web consultancies whether existing and/or proposed to enter in future in the line of similar services and/or will deal in similar services for two years. She will also not divulge the information, knowledge, secrets, know how and technologies which comes to her knowledge in writing and/or orally while in service to any other person during and/or after leaving the service for two years. In case of breach of this clause, second party can recover a minimum of 50% of gross emoluments paid to her while she was in service during the period of this agreement beside other damages and/or losses suffered by the second party by the conduct of first party.
8. It is agreed that if anytime during her employment, the first party is found guilty of misconduct and willful neglect of work or dereliction of duties and/or non-compliance of instructions given to her by the second party from time to time and/or any breach of any term of this agreement, the second party may put an end and determine the employment of the first party by giving him one month notice as stipulated in the appointment letter of first party.
The first party shall be deemed to have brought about such a situation by his misconduct compelling the second party to put an end to his services and the second party may recover all losses/damages besides recovery of 50% gross emoluments paid to her while in service.
9. That the first party undertake to execute bond of indemnity in favour of the second party indemnifying the liquidated damages and/or losses suffered by the second party on account of breach of any of the terms of this agreement which may be caused by the act of the first party.
Contd…3..
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10. That in the event of any dispute and/or differences arising out between the parties hereto either during the subsistence of this agreement or afterwards relating to this agreement, the same shall be referred to the Chief Executive Officer of the second party for his consideration, who will, if the matter is not sorted out amicably, refer the same to the arbitration of the Single Arbitrator who will be nominated by the Board of Directors of the second party, whose decision shall be final and binding on the parties.
11. The other terms as to the payments of emoluments, etc. will remain same as given in her appointment letter and the subsequent amendments from time to time.
12. That the first party will always abide with the rules and regulations applicable in the Company from time to time.
IN WITNESS WHEREOF the parties hereto namely B acting in person and M/s <COMPANY> acting through its Chief Executive Officer have signed and executed this agreement in token of having accepted the above terms and conditions.
FIRST PARTY SECOND PARTY
------------------ ------------
1. B 1. FOR AND ON BEHALF OF <Company Name>
<ME>
CHIEF EXECUTIVE OFFICER
WITNESS
1. ____________________________________
____________________________________________________________________________
____________________________________________________________________________
2. ____________________________________
____________________________________________________________________________
____________________________________________________________________________1) clause 3 is in restraint of trade and void you cannot restrain employee after leaving the organisation form taking any work in another company
2) in the event employee leaves organisation you cannot force her to refund 50%of salary paid to her during the period she was working with your organisation
3) clause 7 is in restrain of trade . you cannot her restrict her after leaving your organisation from joining any web consultancy firm . you can only restrict her from divulging trade secrets
1. It is less a legal issue than a personal issue,
2. You can execute a bond for payment of Rs.10 Lakhs if she resigns within 2 years of joining,
3. You shall have to prepare the back dated appointment letter and also the Band,
4. Moreover, without taking the above steps, you can refuse her resignation citing the Bond,
5. You do not have to show any paper/document to her parents,
6. You can write to her about the payment of the imaginary Bond amount and she is in your side, she can convince her parents accordingly,
7. You need not manufacture/prepare the Bond at all and do not entertain any personal approach by her parents to shhe the papers/Bond.
1.The draft is all right for the purpose,
2. As mentioned in my earlier posting, you need not prepare the Bond/Agreement to show to any body specialy her parents,
3. Since she will accept the the existance of the Bond, your asking for payment of Bond amount after receiving her resignation should be enough for her to convince her parents accordingly.
1. There is nothing wrong with the draft.
2. If B signs on the dotted line she shall be bound to act in accordance with the contract. This may convince her parents to allow her to continue.
3. Draft will serve no purpose if it is not enforced from the date of her actual recruitment.
Thanks for all the advices gentlemen. The current updates are as follows: 1: Her mom came to see me today to negotiate about the bond. I said the company cannot accept resignation without compensation. 2: She requested to grant B leave till February 1st, and I said , B has already been granted 2 days of leave and extending it till month end would cause trouble, but I can consider giving leave but I would require a written consent that is also signed by B requesting for the leave. 3: I asked B not to raise any such request if her parents force her to. 4: B has hinted us that her mom is also willing to take legal help to get the signed employment bond rescinded but B has promised us that she would give us full support on this matter and she would never agree to anything that would prevent her from attending office. 5: Meanwhile, her parents have already started searching for marriage proposals and B said she would never agree to any. So my questions are: What if her parents emotionally blackmail her by saying that they would suicide if she wouldn't agree to one? What if they try to forcibly marry her of to someone? is there anything we can do about that legally to prevent such things from happening? What if they put her in house arrest and doesn't allow her to come to office and won't respond to the notice we send to them regarding the Bond and the compensation? Once again thanks a lot.
1) it is B call whether to accept marriage proposal or not
2)you cannot as employer interfere in her personal decisions of marriage
3)it is for B to decide whether she succumbs to emotional black mail or not
4) if B parents put her in house arrest she can always call police helpline for ladies for help .
5) lodge complaint with state commission for women
6) you can issue legal notice if she fails to report for duty and seek compensation under the contract .
7) invoke arbitration clause in the contract
1. It will be wise for you to confine yourself strictly to the professional sphere. Any advice in professional capacity on issues which relate to the personal life of any of your employees may backfire.
2. B as an adult is at liberty to marry the man she desires. If her parents are opposed to her marriage then the maximum they can do is snap their ties with her, but they cannot harass or intimidate her in any manner. If she feels threatened by her parents she may move to High Court for protection. It is for B to initiate legal action against her parents if her rights are infringed by them.
3. Once the contract of employment is executed it ranks inviolate. If she deviates from the contract you may enforce the contract through court.
1. You are mixing up your role,
2. You are her employer and not 'A' I suppose,
3. Let her decide what she, being an adult individual, should do, should the incidences as csuggested by you take place,
4. Act professionally,
5. Her parents can not file any case against her Company by passing her and do not entertain/negotiate with them in connection with any service matter partaining to B.
Hello A & B are very good friends of mine, so is there anything I can do to help them as both of them are going through extreme pressure and tension? Someone said, B could file an injunction order from court against her family? what are consequences if she does that? and will that be of any use or would that worsen the situation?
1. Let them handle their own problem. If the lady is willing to sign then Bond you can make her execute the same.
2, One can always obtain restraint order in the form of civil injunction from civil court depending on matter and relief sought for but I would not recommend her to do so.
3. if they marry each other, hardly anyone except themselves can break this marriage.
1. If B is under pressure from her parents to marry the other guy then she can come out of her house &/or refuse to marry that guy &/or do all those things which an adult woman of a Metropolitan City of India is expected to do in the year 2015,
2. If she refuses to marry the other guy, her parents can not force her to do that,
3. She can continue to work with you duly convincing her parents that she does not have Rs.10 Lakhs to pay the Bond amount for resigning early.
1) as good friends of A and B you can offer them moral support .
2) you can get bond signed by B that she would not leave your organisation for period of 2 years and in event she does so you can recover the costs of her training
3) B can move court and obtain restraint order against her family members if she so desires
Do not to mix business and relationship together. If A want to marry B then they register their marriage under special marriage act. You can support morally. B can move court and obtain restraint order against her family members if she desires so but definitely complicate the situations. Now the parents are also enquired legal steps and they also more care about the situations .So the story of the bond does not match always and in real time it is tough to you if they challenge the same .
