(OFFICECHAI TEAM): In India, it’s not unheard of for employees to simply switch companies when they get a new job without serving the notice period, but if a company does decide to pursue the case, they can end up with quite a bit of trouble on their hands.
An Ahmedabad local court has ordered an employee to pay Rs. 5 lakh to her employer for quitting without serving the notice period. The case involved Mariya Rajput, who had been appointed as a Trainee Associate (Finance) by corporate recruitment process outsourcing company Jensen Kobain Solutions Pvt Ltd in Feb 2021. After the employee refused to attend work and serve her notice period of 30 days, Jensen Kobain Solutions had approached the local courts, which passed an order allowing the company to recover Rs. 5 lakh from the employee.
Rajput had been initially hired on a probation period of six months. After the completion of her probation period, her appointment was confirmed. The terms of her employment contract required her to give a 30-day notice before her intended last day of work.
But as per the suit filed by the company, Rajput’s attendance was irregular and she used to remain absent from work without obtaining approval. The company says it was forced to issue an absconding notice to her in November 2022, following which she sent in her resignation through email. But the company told her that her resignation wasn’t in accordance with the terms specified in her employment contract, and asked her to serve a 30-day notice period. Rajput however still did not show up to work.
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At this point, the company sent her a notice to her through an advocate, asking her to pay Rs 5 lakh for quitting the job in violation of employment terms. Rajput however ignored the notice, and did not reply to it. The company then filed a suit for breach of contract, specifically citing employment agreement violations, which led to the claimed monetary loss and harm to the company’s reputation. Since the employee did not respond to the court’s notice, it decided to proceed ex parte.
“The plaintiff has also not been cross-examined by the defendant. Under the-se circumstances, as discussed above, I have no hesitation to conclude that the plaintiff-company is entitled to recover an amount of Rs 5,00,000 from the defendant as legal and valid dues,” the court ordered.
A Rs. 5 lakh fine might seem excessive — it’s likely several times of the employee’s monthly salary — but employment contracts are pretty clear about how they can be terminated both ways. Companies are required to give employees a month’s notice if they ask them to leave, and similarly employees are required to serve a notice period if they decide to quit. And with an Ahmedabad court passing an order that severely penalizes an employee for reneging on their contract, it could lead to greater adherence to notice periods on both sides of the employment divide.
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