Employment Bonds.

As per the Indian Contract Act 1872, a "contract" is an agreement that is enforceable by law.Agreements not enforceable by law are not contracts. An "agreement" means 'a promise or a set of promises' having consideration for each other. An agreement is an accepted proposal. Hence, an agreement consists of an 'offer' and its 'acceptance'.

A bond is a contract between an employer and employee. Many of the IT companies like Wipro, Infosys , Satyam have bonds. From the employer's point of view it is important as the employer wants the employee to stay with it for a minimum period so that the company can recover the costs it has incurred in training and enhancing the skills of the resource. Or it may want the services of the employee for some time after the employee becomes ready to be productive for the company. Some IT companies will even charge the employee for the use of resources like PC etc. during the training period if he/she breaks the bond.

From the employee's point of view however it can be an impediment for career growth as it may hinder job switch etc. Also if someone wants to leave the company and go for higher studies before the stipulated contract period then he/ she has to pay the agreed bond amount.

But these legalities are usually clear to the employees from the beginning and accordingly he can take an informed decision. Usually if an employee goes absconding without resigning he can escape paying the bond amount, but he won't get any PF money, experience letter or a relieve letter. This might as well hamper his future job prospects.

Also many times the company has arrangements with a bank and makes the employees take loans equal to the bond amount and pay it to the company. If the person goes absconding then its the bank's loss. But there can be serious legal implications for the person if he is caught.

Nowadays, many people break bonds and move on to better opportunities. It also happens that if a person switches a job and he is a very talented resource, then his new employer will pay for the bond amount with the previous employer. Also, many companies have bond where in they don't demand any compensation from the employee but they won't simply give an experience letter. This is to deter him/her from leaving the company before he/she has served there for a certain period.

Also many times one can negotiate with the HR team with the help of one's manager to bring down the severance amount depending on the period he has served etc. So how actually companies respond to such employees also varies from company to company.

If a bond is a valid contract, company may go to court.I think organisations are very powerful entities and it is difficult for an individual to take a stance against them. So either the employees abide by the rules of the bond or they be ready to face the consequences. But none the less, companies should not use bonds as a weapon against their employees.

Any act on the part of company e.g. retaining the original educational certificates/ creating any kind of impediments for the concerned employee to join a job(i.e. to earn) will adversely mar the cause of company. Also , the amount of compensation a company can claim must be commensurated with the loss caused , and not more. Any condition which violates the fundamental rights as defined in constitution / are not tenable in the eyes of law, will also mar the validity of bond in question.