Calcutta HC on Job Search: Looking for Work in a Rival Company Is a Right, Not Misconduct
Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator.
View all posts by this Author
By Sunil Garodia
First publised on 2025-08-30 07:34:30
About the Author
Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator.
View all posts by this Author
Balanced Judgment
The Calcutta High Court, in M/s. Xpro India Ltd. vs. The State of West Bengal, has held that seeking employment with a rival company cannot be treated as dishonesty or moral turpitude. Justice Shampa Dutt (Paul) ruled that exploring opportunities in another firm - even a competitor - is a basic right of every worker and cannot justify denial of statutory dues such as gratuity.
This verdict is a significant assertion of employee rights in India's corporate environment, where firms often stigmatize job mobility as disloyalty. The court emphasized that employment is not servitude and that professional advancement cannot be criminalized.
The Case Background
The matter arose from the termination of a technician who had worked with Xpro India Ltd. for ten years. The company accused him of negotiating with a rival and, on that basis, withheld his gratuity on grounds of "moral turpitude." An internal inquiry was conducted, but the employer failed to produce any substantive evidence - no witnesses, no call records, no proof of confidential information being leaked.
The company alleged that the said employee was going to pass on technical information and business secrets to the rival company which was setting up a similar business.Despite the lack of proof, the company pressed its charge and refused gratuity. The employee challenged the action. The Controlling Authority under the Payment of Gratuity Act ruled in his favour, directing release of Rs 1,37,308 plus interest. The employer's appeal was dismissed, leading to the writ petition before the High Court.
The Court's Rationale
The High Court struck down the company's stance, noting that searching for another job - even with a rival company - is not contrary to honesty, modesty, or good morals. The charge of moral turpitude requires evidence of fraud, theft, or inherently wrongful conduct. Job mobility does not meet this test.
The court observed that the inquiry against the employee was an abuse of power and violated the principles of natural justice. Denying gratuity without evidence amounted to punishing the worker for exercising a basic right. Accordingly, the court upheld the earlier orders and directed the employer to release full gratuity with 8% interest within 60 days.
Drawing the Line: Mobility vs. Misconduct
While upholding the right to job mobility, the judgment draws a clear distinction: if an employee shares trade secrets, processes, client lists, or technology with a rival, that is misconduct and punishable. Breach of confidentiality and intellectual property theft remain serious offences.
This balance is crucial. Workers are free to seek growth and better opportunities, but they cannot compromise the legitimate interests of their current employer. The verdict affirms that the line lies in conduct, not ambition.
Implications for Employers
The judgment serves as a caution to companies. Employers cannot weaponize vague allegations of disloyalty to penalize employees or withhold statutory dues. Instead, they must rely on enforceable safeguards - such as confidentiality clauses, non-disclosure agreements, and legal remedies in case of actual data theft.
The ruling also implicitly questions the over-broad use of non-compete clauses in contracts. Restrictions that attempt to curtail an employee's future employment opportunities will not withstand judicial scrutiny when they infringe on basic rights.
Implications for Employees
For workers, the verdict provides legal certainty: job hunting is not misconduct. Employees can pursue career advancement without fear of being branded dishonest, as long as they respect confidentiality obligations. The judgment affirms that professional mobility is an integral part of dignity at work.
Strong Verdict
The Calcutta High Court has delivered a balanced and far-reaching ruling. It safeguards employees' right to aspire for better prospects while protecting companies against genuine breaches of trust. By distinguishing the right to mobility from the duty of confidentiality, the court has clarified an area of law often muddied by employer overreach.
This verdict will have a lasting impact. It ensures that workers are not shackled by accusations of "moral turpitude" for simply seeking growth, while reinforcing that betrayal of trust through data leakage or process theft will not be tolerated.
