Unfair Employment Terms - a must-read for employers
UnfairEmployment TermsWhat Employers MUST know? vakilsearch.com
In labour law, one of the commonest issues that crops up is a disagreement over the employmentcontract. If the disagreement is not properly handled, it could transform into a dispute. Hence it is veryimportant to carefully draft your employment contract so that the possibility of disagreements isminimized.Having said that, no matter what precautions you take, there is a possibility of an employee disagreeingwith you and claiming that his / her contract is unfair. And most often, they point to a few clauses whichinclude:SALARYRemember, a poor or low salary by itself does not amount to an ‘unfair contract’. It only becomes a legalproblem if it is below the minimum wage prescribed by law. In that case, you have to increase the salaryso that it is atleast equal to the minimum wage.The minimum wage differs from state to state and from sector to sector, so just check the relevantGovernment notification that applies to you to see what the minimum wage for your business is.Apart from the salary being below the minimum wage, you have to ensure that you do not discriminateagainst one employee for any reason. Discriminating against female employees on the ground of genderor against employees on the basis of caste or religion is a constitutional violation. If there is a difference insalary to different employees performing the same work, you will have to justify it on some reasonablebasis or else it could cause you legal trouble.BONDThe ‘unfair contract term’ most employees complain about is the bond. A bond essentially is a restrictionon the right of the employee to leave the employment for a specified period of time.A bond, depending on how long the period is, may be unfair. But it entirely depends on that period andwhat kind of investment has gone into training the employee, or what kind of investment the company hasput into the employee.If the company has invested heavily in the employee, a longer bond period may be reasonable. On theother hand, if the investment in the employee is low / negligible, then the Company might find it difficult tojustify any bond period at all.Often, and you find this even in Government bodies, a high bond period is associated with super-specializations. For instance, in many hospitals, the contract with super-specialist doctors stipulates thatthe doctors cannot leave for a considerable period (sometimes upto 8 – 10 years), justified by theinvestment in that doctor and the scarcity of super – specialists.Technology companies can justify bond periods for their engineers, and technology start-ups for theiremployees by showing that they incurred expenses in training and education of the employee. Rememberto keep the receipts and bills showing the expenses handy in case the worst happens, i.e. in case thematter goes to Court.