Exercise 2- Employment Agreement

A.
1. The “TERMINATION” clause is not in favour of Mr.Raj simply because its arbitrary
nature implies a restraint of trade on the Employee and forbids him from terminating
his agreement if he wishes to do so that is against the provisions of the Indian
Contract Act, 1872.

The re-drafted clause:

a. Termination- This Agreement shall be terminated at the will of either the
employer or the employee. The party terminating the Agreement shall provide the
other with a notice of one (1) month before executing the termination. In the event
that the Employer becomes bankrupt, this agreement shall be terminated at the
will of the Employee.

2. The “NON-COMPETE” clause also does not favour Mr.Raj as it puts on an

unreasonable restriction upon him by forbidding him to work in the same field
indefinitely. If the clause had a reasonable time limit or an area incorporated within
itself it would not have been an Agreement in restraint of trade.

The re-drafted clause:

b. Non-Compete- After the termination of this Agreement, the Employee is
prohibited from and strictly restrained from engaging in a similar line of
employment, or otherwise performing services for compensation for any other
entity for a period of six (6) months from the date of the termination.

3. The “DISPUTE RESOLUTION” clause overtly favours the Employer and is rather
biased against Mr.Raj as he would not be able to voice his predicaments during the
course of the employment. Additionally, it also restricts his legal right to pursue an
action against the Employer under circumstances that may be necessary to report. In
conclusion, this clause makes for an authoritarian regime on the Employer’s behalf.

c. Dispute Resolution- In the event of a dispute between the Employer and the
Employee, the same shall be referred to the jurisdiction of an independent sole
arbitrator in accordance with the Arbitration and Conciliation Act, 1996. All the
lawsuits pertaining to the dispute as well as the arbitration shall be governed by
the jurisdiction of the Delhi High Court.

B.
a. Compensation and Benefits-
1. In consideration of Mr.Raj’s services to XYZ Pvt. Ltd., XYZ Pvt. Ltd. shall pay to the
Employee, during the term of this Agreement, gross revenue amounting to Rs. 30,000 (Thirty
Thousand Rupees) per month, subject to deduction of tax at the source along with other
benefits as per XYZ Pvt. Ltd.’s policy.
2. The Employee shall also be entitled to a bonus based on his performance review that is to
be conducted every six (6) months.
b. Scope of Employment-The Employee shall work full time for XYZ Pvt. Ltd. in the
capacity of a marketing executive and shall be required to make calls, conduct data analysis
of consumers, analyse consumer trends and patterns and show initiative in coming up with
plans increase the reach of the Company and any other work in relation to the marketing of
XYZ Pvt. Ltd.