A contract requiring workers to work for a particular employer for an outlined interval in trade for coaching or different advantages is acknowledged underneath Indian legislation. Such agreements usually contain monetary penalties ought to the worker depart earlier than the agreed-upon period. For instance, an organization may spend money on specialised coaching for a brand new rent and, in return, require a dedication to stay employed for a set variety of years.
These preparations supply benefits to each employers and workers. Corporations can shield their investments in human capital and keep workforce stability, particularly in specialised sectors. Workers, conversely, might acquire entry to beneficial abilities and expertise they may not in any other case obtain. The enforceability of such agreements, nevertheless, hinges on elements like reasonableness of the bond’s period and the penalty quantity, in addition to the presence of unfair or restrictive clauses. Traditionally, these agreements have been frequent instruments for workforce retention, notably in industries with excessive coaching prices or fast worker turnover.
