Yesterday one of my acquaintance said that she is unable to move to different
company because as per her company's rules an employee cannot join a competitor

I would like to clarify that such rules have no legal binding and is void (i.e.
invalid) as per section 27 of Indian Contract Act, 1872.

The law states that any agreement that prevents you from taking up a lawful
business, profession or trade is invalid. Thus, one cannot be stopped from
working for a competitor after leaving the job.

Thus, employees can join a competitor even if they have signed an agreement
undertaking to not join (as the agreement is invalid)

The only way a company can legally prevent you from joining another firm is by
putting you on garden leave, where you would continue to get salary after
resignation for a specific period but would not be allowed to work for anyone
else. Lot of financial services firm have this system in place for certain

I had shared this info long ago. But since I once again encountered another
person with same concern, I thought of sharing it again.

Originally posted by Viswanathan M B on LinkedIn