Tuesday 3 April 2012

Whether injunction can be granted to restrain employee from joining another company?

N.S.Golikari Vs Century Spinning & Manufacturing Co. Limited (AIR 1967 sc 1098; Rajan G.R.V. Vs Tube Investment of India
Limited (1995 (1) LW 274) and Superintendence Company of India (P) Limited Vs Krishna Murgai (AIR 1980 SC 1717).

Explaining the same in detail, learned advocate Shri. H.L. Kumar has stated in the journal section of the Labour Law Reporter (Feb-05; 38-42) that such clause is legally impracticable and unrealistic.

In his article he has referred to the case of Pepsi Foods Limited & Others Vs. Bharat Coca-Cola Holdings Pvt. Limited & Others (LLR, 1999, 1027) wherein the Delhi High Court has said, “injunction cannot be granted to create a situation such as “Once a Pepsi employee, always a Pepsi employee”. It would almost be a situation of economic terrorism or a situation creating conditions of bonded labour”. It has also said that inter-changeability of service is an accepted norm of Service Jurisprudence that cannot be curtailed by a court injunction.

It is interesting to note that, the Court said that, in a free market economy, everyone concerned, must learn that the only way to retain employees is to provided them attractive salaries and better service conditions. The employees cannot be retained in the employment perpetually or by a Court injunction.
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