The Delhi High Court has ruled that employees cannot be forced to choose between working for their previous employer or remaining idle.
A vacation bench of Justice Tejas Karia held, “An employee cannot be confronted with the situation where he has to either work for the previous employer or remain idle. An employer employee contracts, the restrictive or negative covenant are viewed strictly as the employer has an advantage over the employee and it is quite often the case that the employee has to sign standard form contract or not be employed at all. Further, the reasonableness and whether the restraint is partial or complete is not required to be considered at all when an issue arises as to whether a particular term of contract is or is not in restraint of trade, business or profession.”
The Court thus held that any terms of the employment contract that impose a restriction on the right of an employee to get employed post-termination of the contract of employment shall be void being contrary to Section 27 of the Indian Contract Act.
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