The Kerala High Court has ruled that when an employee submits a resignation in line with the terms of their employment contract, the employer must accept it, and refusing to do so can amount to bonded labour.
The court made this observation while granting relief to a company secretary working in a public sector undertaking (PSU) who was being prevented from leaving his job despite resigning.
Kerala High Court Says Refusing Valid Resignation Amounts to Bonded Labour
Justice N Nagaresh stated that if an employee has complied with notice period requirements and other contractual obligations, the employer cannot reject the resignation unless serious disciplinary proceedings are being considered for grave misconduct or financial loss caused to the organization.
The judge clarified, “In any other circumstance, if the employer refuses to accept the resignation of an employee, it would amount to bonded labour prohibited under Article 23 of the Constitution of India.”
The case arose from a petition filed by the company secretary challenging show-cause notices and memos issued by the PSU that directed him to return to work even after he had formally resigned.
The PSU had declined to accept his resignation and asked him to explain why disciplinary action should not be taken against him.
The organization justified its refusal by citing its poor financial condition and stating that his services were indispensable.
The court rejected this reasoning, holding that financial hardship or institutional emergency cannot force an employee to continue working without consent.
The judgment stated, “The disciplinary proceedings contemplated against the petitioner in the circumstances can only be seen as an attempt by the respondents to violate the petitioner’s right to resign from service.”
Court Notes Salary Default and Personal Hardship in Company Secretary’s Resignation Case
The court also observed that the PSU had failed to pay the petitioner’s salary from October 2022 onward.
It was noted that the petitioner chose to resign after his father’s death in 2020, which left him responsible for his mother, who has long suffered from neurological and psychiatric conditions.
The court remarked, “The petitioner, therefore, had no other option but to search for another job.”
It further pointed out that he was unable to obtain new employment because the PSU had not requested the Registrar of Companies to remove his membership association with the company.
The court directed the PSU to formally accept his resignation, relieve him from duty “as expeditiously as possible and at any rate within a period of two months,” and clear all pending salary arrears, leave surrender benefits, and other legally due terminal benefits.
The court added that these payments should be made promptly, taking into account the PSU’s financial position.
The report concludes by stating that the article was generated from an automated news agency feed without editorial changes.
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