The employment requirement is considered appropriate because it is necessary to protect the interests of the employer. However, the restrictions placed on the worker in the contract should be “reasonable” and “necessary” to protect the employer`s interests, or the validity of the obligations is under consideration. The implementation of the employment obligation cannot compel the worker to work for an employer. In the event of a worker`s default, the employer`s only recourse is to obtain a reasonable amount of compensation. Although Section 27 of the Act clearly states that any non-competition agreement is null and clear and does not engage the contracting parties, several decisions stipulate that a negative clause would not be considered reluctant to trade in an agreement to promote trade. A company strives to protect its activities, to protect its confidential information and the sensitive business knowledge provided to it. When an employee stops and a competing company starts in the same field as the company, he can translate to the employee who uses the company`s knowledge to obstruct the business. Therefore, it is customary for companies to include in the employment contract a non-competition clause with their employees in order to guarantee the protection of their companies. However, just because an offence is proven, the court would award the employer the full amount of damage under the contract.
Thus, the Tribunal took into account the effective loss of the employer in the Sicpa India Limited case against Shri Manas Pratim Deb. Unlike the 2.00,000 compensation of the rule, the court awarded damages amounting to 22,532 UK. In this case, the employee resigned from his job after two years instead of three on behalf of the loan. The above analysis shows that the restrictions imposed during the period for which the worker is willing to serve are generally not akin to a trade restriction. This implies a reservation that alliances are not one-sided, do not impose unreasonable chains and are not oppressive. However, post-termination restrictions would be considered invalid and would be contrary to Section 27 of the Indian Contracts Act, 1872. In addition, in calculating the damages of liquidation awarded in the event of non-compliance with a employment loan, the Tribunal would take due account of the above guidelines and would have little chance of granting some performance of the contract. In addition, the links would also be valid for the trainees if the employer proves that he suffered a violation of the law as a result of the break of the loan by the trainee. Companies often invest a lot of time and money in training their employees to gain a competitive advantage. Regardless of this, the rate of wear remains significant.