The validity of employment obligations can be challenged on the basis of section 27 of the Indian Contracts Act. Section 27 of the Indian Contract Act, 1872 prohibits any trade and trade restriction agreement. Any trade and professional agreement under Section 27 is non-acute. Courts have generally held that the right to exist of workers must take precedence over the interests of employers, despite an agreement between the two parties. For example, in the 2009 Deiccant Rotors International (P) Ltd/Bappaditya Sarkar case, the Delhi Supreme Court found that, in cases of conflict between employers` attempts to protect themselves from competition and the right of workers to seek employment where they wish, „the right to workers` livelihoods must prevail as a priority.“ Some authors argue (and reasonably) that the invalidation of restrictive pacts is that, paradoxically, their implementation would result in the worker being paradoxically „because of his increased expertise, the evolution of the sector where he is most productive“. Three apprentices have been selected by the employer who has signed a loan indicating that they will receive two years of training in the company and will work in the company for at least five years after their training. In the event of a violation of this condition rs. 10,000 were to be compensated for the damage caused to the employer. The intern resigned after five months of training. In this case, the High Court of Kerala decided that candidates were selected for training and not for permanent service, but that they nevertheless provided a great deal of time, energy and expense from the employer. The employer will certainly suffer losses if an intern breaks the condition of the attachment and leaves. The employer is derived from the expected performance of a competent person.
Violation of the relationship by the intern is an aspect that harms the employer. Only the amount of damage must be decided. Under the section 27 mandate, any agreement directly or indirectly requiring the worker to serve the employer or a restriction on membership in a competitor or other employer is not valid under Indian law, the worker has the right to resign even if he has agreed to serve the employer for a certain period of time in the employment obligation.  Where an employer has incurred financial costs for the worker`s training for the job in question, it can claim damages for the damages it has suffered. The question here is whether such a method of recruiting workers is effective, acceptable and applicable under the law. This article discusses the applicability of employment obligations and the rights available to employers and workers under the agreement, in light of various court decisions. The current era is undergoing phenomenal changes in the economy and industrial processes, which has led to increased competition in companies. To compete, employers spend a great deal of money training their workers to improve the quality of the company`s goods and services.