Is it Legal to Break a Bond Period in an Employment Contract?

Yes, breaking a bond period in an employment contract is legal under certain conditions. Indian courts uphold employment bonds if they are reasonable, do not impose a penalty, and compensate actual loss.

Under the Indian Contract Act, 1872, particularly Sections 73 and 74, a bond is enforceable only to the extent of actual damages suffered by the employer.

In Niranjan Shankar Golikari v. Century Spinning & Mfg. Co. Ltd. (1967), the Supreme Court upheld valid restrictive employment bonds. However, if the bond is one-sided, coercive, or amounts to forced labour (violating Article 23 of the Indian Constitution), it can be struck down.