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HomeDocumentationEmployment Agreement Drafting

Documentation

Employment Agreement Drafting

We draft a compliant, India-specific employment agreement for a named role: statutory particulars, an IP assignment clause that covers what copyright law alone doesn't, and confidentiality and non-solicitation terms scoped to what Indian courts actually enforce, so the hiring is documented properly rather than just offered.

An employment agreement is the document that actually creates a binding employment relationship, carries the statutory particulars a plain offer letter skips, and gets IP assignment and restrictive covenants right for Indian law instead of a copied US template. We draft it around your specific role.

An employment agreement is a private contract between you and your hire, valid once it has free consent, lawful consideration, competent parties, and a lawful object, the general requirements under the Indian Contract Act, 1872. Once both sides sign it, it becomes the binding instrument. The offer letter that came before it doesn't do that job.

It isn't paperwork you get to later. State Shops and Establishment Acts, and the standing-orders framework for larger establishments, effectively require written terms of service once a business crosses a state-set headcount. The four central Labour Codes have been in force nationwide since 21 November 2025.

Scope

What's included

  • We draft designation, wage structure, place of work, working hours, leave, probation, and notice period against your state's Shops and Establishment Act, rather than a single generic national template.

  • Copyright Act s.17(c) covers work made in the course of employment automatically. It doesn't cover patents, it doesn't cover work created before the employment relationship existed, and moral rights survive it regardless. We draft the assignment clause to close that gap.

  • Post-employment non-compete clauses are void under Contract Act s.27. We draft confidentiality and a narrowly-scoped non-solicitation clause instead: the categories that actually hold up.

  • A check-in on role-specific terms before the agreement is finalized.

Specifics

The details

What actually makes an employment relationship binding

An offer letter can bind both sides to the extent of what it states once a candidate accepts it, under Section 10 of the Indian Contract Act, 1872. It's usually silent on working hours, leave, probation mechanics, and notice period, because that's not its job. The appointment letter or employment agreement, once signed, is the document that actually carries those statutory particulars and forms the full employment contract.

The IP assignment gap most templates miss

Section 17(c) of the Copyright Act, 1957 makes the employer first owner of a work made in the course of employment under a genuine contract of service. It's the exception people reach for, and it covers less than most templates assume.

  • Copyright: covered automatically under s.17(c), for work made in the course of employment
  • Patents: not covered by any equivalent provision. The inventor stays default first owner regardless of employment status, unless the agreement assigns the rights explicitly
  • Pre-employment work: not made 'in the course of employment', so it needs a separate express assignment even once the person joins as an employee
  • Moral rights under s.57: survive a valid copyright assignment. An author can consent to specific acts but can't contractually waive the rights themselves

Non-compete clauses: why we leave them out

A post-employment non-compete is void under Section 27 of the Indian Contract Act, 1872. Niranjan Shankar Golikari v. Century Spinning & Mfg. Co. Ltd. (Supreme Court, 17 January 1967) is the leading case: an employee can be held to exclusivity during service, but once employment ends, a clause restraining where they work next doesn't survive. Varun Tyagi v. Daffodil Software (Delhi HC, FAO 167/2025, 25 June 2025) confirms the same line stands today. We draft confidentiality, a narrowly-scoped non-solicitation clause, and garden leave for the notice period instead. Those are the restraints Indian courts actually enforce.

Termination and notice: contract terms and the statutory floor

For most of BuildWright's clients, notice period is primarily what the contract says, layered on your state's Shops and Establishment Act baseline. The Industrial Relations Code 2020's retrenchment mechanics (one month's notice plus 15 days' average pay per year of service, prior government permission above 300 workers) apply to larger industrial establishments almost none of our early-stage clients will reach. We draft the notice clause the contract actually needs, and reference the applicable state Act rather than hardcoding a number that's wrong in most states.

The Labour Codes: where things stand

The Code on Wages, the Industrial Relations Code, the Code on Social Security, and the Occupational Safety, Health and Working Conditions Code are in force nationwide since 21 November 2025, with Central Rules finalised on 8 May 2026. State-level rules are still catching up unevenly, so we treat day-to-day formatting mechanics as state-and-time-sensitive rather than settled everywhere at once.

Process

How it works

Step 1 of 4

Gather your inputs

Role, compensation structure, place of work, probation terms, and whether the role touches code, design, content, or inventions.

Gather your inputs

Role, compensation structure, place of work, probation terms, and whether the role touches code, design, content, or inventions.

Common mistakes founders make

  • Treating a signed offer letter as the complete employment contract.
  • Copying a US-template 12-month non-compete into an Indian agreement. It's void the moment it tries to restrain a former employee.
  • Assuming Copyright Act s.17(c) already covers patents or pre-employment work. It doesn't.
  • Skipping the IP assignment clause because 's.17(c) already handles it', when s.17(c) only covers work made during employment under a genuine contract of service.
  • Hardcoding a leave-entitlement number that's wrong for the actual state, since leave is governed by the applicable state Shops and Establishment Act rather than one national figure.

Clarifications

Frequently asked questions

Yes. An offer letter is a conditional proposal, thin by design. It usually doesn't cover statutory particulars, IP assignment, or restrictive covenants. The employment agreement is what actually documents the relationship.

A post-employment non-compete is void under Section 27 regardless of how senior the role is. What we draft instead: confidentiality, a narrowly-scoped non-solicitation clause, and garden leave during an active notice period.

Section 17(c) only covers work made in the course of employment. Work from before the employment relationship existed needs a separate, express, present-tense assignment.

We note that an ESOP reference exists in the agreement. Valuation and perquisite-tax treatment sit with your CA, outside this service's scope.

Yes. All four central Labour Codes have been in force nationwide since 21 November 2025, with Central Rules finalised on 8 May 2026. State-level rules are still catching up unevenly.

Related

Learn more

Free templates & checklists

Ready-to-use starting points — no email required.

Template

buildwright.co.in

Offer Letter Template

A blank, fillable offer letter for Indian hires that stays upfront about being the first step, not the finished employment contract, with the acceptance deadline, conditions precedent, and appointment-letter follow-on stated in the letter itself.

Learn the details

Guides that walk through every step.

Guide

buildwright.co.in

Non-Compete Clauses Are Void in India: What Actually Protects You Instead

A post-employment non-compete is unenforceable under Section 27 of the Indian Contract Act, 1872, confirmed as recently as a June 2025 Delhi High Court ruling. Here's what actually holds up instead.

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Key terms

s.10, Indian Contract Act
The general basis for a valid, binding contract in India: free consent, lawful consideration, competent parties, lawful object.
s.17(c), Copyright Act
The employer-first-owner exception for a work made in the course of employment under a genuine contract of service. Doesn't extend to patents or pre-employment work.
s.27, Indian Contract Act
Voids agreements that restrain a person from practising a lawful profession, trade, or business. The basis for why post-employment non-competes don't hold up.
Labour Codes
The four central codes (Wages, Industrial Relations, Social Security, Occupational Safety Health and Working Conditions), in force nationwide since 21 November 2025.