Ankita Katdare
Ankita Katdare
Computer Science
17 Nov 2015

What if I break the company bond? What role does NASSCOM play?

Most freshers who have secured a job in an IT company through campus placements are worried about the Employment Service bond that they are made to sign. The 'bond' - which is essentially a contract that demands that you pay a certain amount of money if you choose to decide to leave the company before a specified time - has been made mandatory by many IT companies including TCS, Infosys, Tech Mahindra, Wipro etc. in the recent past.

Someone just sent me a message asking, "What would happen if I break the company bond?"
He further wrote, "Will I really have to pay the bond? What if I refuse stating some reason?"

It turns out that news has it that such bonds are illegal in India, in that companies can not force any employee to sign a bond. Only how much of it is true nobody seems to know.

Some also say that NASSCOM can blacklist an individual if he/she resigns from a company without paying the bond amount.

Some say it is a a myth that ITES companies can blacklist you on NASSCOM.

I've heard that there are thousands who simply walk out of companies and never pay the bond amount. Some say that they receive a legal notice, but they don't pay heed to it and all of it dies within a few months.

I read somewhere that as per the Indian Constitution, "No company bond can force any person to work against the employees wishes."

So, what is your say folks, how serious are these IT company bonds? Share your experiences please.
Breaking a bond isn't really recommended. If you break the bond and do not pay the amount; you are at a risk of legal action. Most of the times, the big corporates won't bother - but you can't take them for granted. Mind well that the big IT companies have lot of cash and dedicated lawyer teams to take care of all the legal aspects.

Think of the whole scenario from the company's perspective. They've invested lot of money in training you for 3-6 months and all of a sudden, you decide on leaving the company for better prospects. What does that leave the company with? Why should the company bear the cost of training you, while paying you salary?

I have had friends who've broken the company bond; got a legal notification from the company and they were brave enough just to ignore it. However, if the company decides on following and sticking to the course of legal action against you - you can get screwed. Be 100% sure about what agreements you are signing.

In all practical terms - the companies will seldom take action and 'blacklist' you with NASSCOM. I don't think any such thing really happens. No company would have a personal vendetta against you that they will block you from joining other company.

All that said - the only sensible advice is this:-
  • Do not sign the agreement if you know that you'll be leaving the company.
  • If you've signed the bond, then honour it.
  • If you want to quit, pay the amount and quit.
  • If you want to quit and don't want to pay the bond money; hope to be lucky. Prepare yourself for the worst.
I'm looking forward to real life experiences where the company actually followed a legal course to recover the bond money from the candidate who broke the agreement.

Share this content on your social channels -

Only logged in users can reply.