Legal Notice served for Dual employment
5 months ago
Hi,
I joined in one organization on May 15th and I noticed that it's a very small organization then j decided to join another orgnization on May 22 without completing the formalities and I worked for both organizations. Now first company got to know that I am working for two companies and they asked for truth and I agreed the same. Now they served legal notice that I have to pay 30 lakhs as a penaility along with salary. I received only two months salary from them. I worked hard during that tenure and supported well. How to proceed further as I didn't do this internationally and didn't harm anything. But for 2 or 3 months I worked for both companies.
A.Dear Client,
When you accept a job offer and sign an employment contract, you enter into a legally binding agreement with your employer. This contract typically outlines your duties, responsibilities, compensation, and other terms of employment. It may also contain clauses that restrict your ability to work for other companies.
In India, there is no specific law that prohibits dual employment. However, many employers include clauses in their employment contracts that restrict employees from working for other companies. These clauses are typically designed to protect the employer's confidential information, prevent conflicts of interest, and ensure that employees are fully committed to their primary job.
You have the right to defend yourself against these allegations. Firstly, we'll have to go through your employment contract. Please reach out to our legal team for preparing the best arguments for your defense.
When you accept a job offer and sign an employment contract, you enter into a legally binding agreement with your employer. This contract typically outlines your duties, responsibilities, compensation, and other terms of employment. It may also contain clauses that restrict your ability to work for other companies.
In India, there is no specific law that prohibits dual employment. However, many employers include clauses in their employment contracts that restrict employees from working for other companies. These clauses are typically designed to protect the employer's confidential information, prevent conflicts of interest, and ensure that employees are fully committed to their primary job.
You have the right to defend yourself against these allegations. Firstly, we'll have to go through your employment contract. Please reach out to our legal team for preparing the best arguments for your defense.
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A.Dear Client,
The Factories Act, 1948 and the Industrial Employment (Standing Order) Rules, 1946, prohibit adult workers from engaging in dual employment. Further, rules related to dual employment have been captured under State-specific labour laws. There is no overarching law that prohibits a person from doing multiple jobs. However, a person of a similar nature of jobs may spark a breach of confidentiality issues - a lot of companies have confidentiality clauses in the employment agreement along with clauses prohibiting multiple employments. It is not illegal however both companies should not have the clause “cannot take up work full time in some other company” then the issue will arise when TDS is being filed by both employers will come to know and then you may lose both jobs. The dual employment provisions of Indian law do not specify the penalties for dual employment. Numerous court decisions state that dual employment in India has led to the termination of employees who hold both positions. In addition, the employer can demand compensation from the employee for a breach of contract that causes directly or indirectly any damage or injury to the employer. However, Section 73 of the Indian Contract Act, 1972 makes provision for unliquidated damages (not stipulated in a contract), Section 74 of the said Act deals with liquidated damages (stipulated in a contract) and no compensation is attracted for mere breach of contract u/s.73. 74 of the Act unless such breach resulted in an actual loss or damage to the opposite party employer. In the given situation, you have to send a strong reply to the legal notice of the Company refuting their exorbitant claim and if the Company files any suit against you for recovery of compensation, then you need to defend your case strongly by hiring an experienced Advocate to avoid all sorts of legal consequences affecting your service career.
The Factories Act, 1948 and the Industrial Employment (Standing Order) Rules, 1946, prohibit adult workers from engaging in dual employment. Further, rules related to dual employment have been captured under State-specific labour laws. There is no overarching law that prohibits a person from doing multiple jobs. However, a person of a similar nature of jobs may spark a breach of confidentiality issues - a lot of companies have confidentiality clauses in the employment agreement along with clauses prohibiting multiple employments. It is not illegal however both companies should not have the clause “cannot take up work full time in some other company” then the issue will arise when TDS is being filed by both employers will come to know and then you may lose both jobs. The dual employment provisions of Indian law do not specify the penalties for dual employment. Numerous court decisions state that dual employment in India has led to the termination of employees who hold both positions. In addition, the employer can demand compensation from the employee for a breach of contract that causes directly or indirectly any damage or injury to the employer. However, Section 73 of the Indian Contract Act, 1972 makes provision for unliquidated damages (not stipulated in a contract), Section 74 of the said Act deals with liquidated damages (stipulated in a contract) and no compensation is attracted for mere breach of contract u/s.73. 74 of the Act unless such breach resulted in an actual loss or damage to the opposite party employer. In the given situation, you have to send a strong reply to the legal notice of the Company refuting their exorbitant claim and if the Company files any suit against you for recovery of compensation, then you need to defend your case strongly by hiring an experienced Advocate to avoid all sorts of legal consequences affecting your service career.
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