I have an NDA signed with the present organization which states that i can't join companies with similar nature of business, products for the next 15 years. Since this NDA was forced to be signed by the employees, there was no option but to sign it as we are relieved from the previous employment fully. Is this legally valid to lock employees from joining similar product company as a person from Ford motors, can't join either Hyundai or Nissan motors and has to join irrelevant industry?
From India, Chennai
From India, Chennai
The period of 15 years for non-compete clause is really unreasonable and onerous. Such a clause will not be upheld by the Courts. Indeed there is a Delhi High Court judgement in M/S STELLAR INFORMATION TECHNOLOGY PRIVATE LTD Versus MR RAKESH KUMAR & ORS decided on 29.08.2016 which clearly sums up the law on the subject. In fact, it will be impossible for any employer to keep track of its employees for the next 15 years after termination of service.
From India, Mumbai
1422From India, Mumbai
In the Indian Context, we cannot precisely say that a Non-Disclosure Agreement or Non-Compete Agreement between an employer and his employee is completely invalid as it is violative of sec.27 of the Indian Contract Act,1872. So many factors like the position held by such an employee, the amount of time and money invested by the employer to impart specialised training to the employee, the length of time and the extent of geographical limits in which the employee can hire out his services to similar industries or start his own venture of similar or same business after his separation etc., have to be looked into in this regard.
However, I agree with Mr.KK!HR that 15 years ban on reemployment in a similar industry is too long a period and it can raise the question of adequate compensation by the employer commensurate with the length of the ban.
From India, Salem
However, I agree with Mr.KK!HR that 15 years ban on reemployment in a similar industry is too long a period and it can raise the question of adequate compensation by the employer commensurate with the length of the ban.
From India, Salem
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Non Disclosure Agreement by employees- Validity -Interpretation of NDA.docx
Nda-employee_17 0.pdf