Why Does One Employee's Exit Matter To The Company?

VKC 2026 | Vol.1 | FN | Issue 01 | 28 Jul 2026 | Author: Adv. Anagha Kulkarni, Co-Author: Adv. Harish Kumbhar | Editor: Adv. Siddhi Nadgir | Reviewer : Adv. Harish Kumbhar

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"Every operational framework of a business must fit within the four corners of law; where it does not, operational gaps eventually become legal disputes." - Adv. Harish Kumbhar, Founding Partner.

A FOUNDER NOTE ON THE REALITY OF COMPANY EXITS.

Most people view employee absconding as an HR issue.

Adv. Harish Kumbhar never has.

To him, it is a breakdown of the organisation's legal and operational ecosystem - one that quietly exposes how one avoidable risk can derail a Company’s reputation and growth by years.   

While an employee absconding is an unwelcome shock, the gravity of the issue becomes apparent only when the HR tells you that the employee has now joined your competitor. 

A lot of employers assume they have no remedy because post-employment non-compete restrictions are generally unenforceable in India¹.

Harish Sir’s view is that this is where the discussion often stops too early.

The real question is not simply whether the employee joined a competitor.

It’s whether the employer had already protected the confidential information, intellectual property, client relationships, specialised training and commercial advantage that were entrusted to that employee before the exit.

One thing that has stayed with me while working with Adv. Harish Kumbhar is how he approaches every employment dispute.

He doesn’t begin by asking, “What action should the employer take now?”

Instead, he first asks “whether the employer’s own operational framework fits perfectly within the four corners of Law?”

He believes every business process should have a legal safeguard built by strengthening documentation.

When this safeguard alignment is missing, small operational gaps slowly turn into legal vulnerabilities and, sooner or later, those vulnerabilities become disputes.

These are few of the legal necessities which every Company should maintain:

• Duly executed Employment Agreements and Confidentiality Agreements² creating enforceable contractual obligations.

• Clearly identified and contractually defined the business's confidential and proprietary information³, distinguishing it from an employee's general skill, knowledge and experience, while incorporating intellectual property ownership and non-solicitation obligations to safeguard legitimate business interests.

• Maintained records evidencing issuance of company assets, system access, confidential information and proprietary resources entrusted to employees.

• Well maintained employment records including attendance, salary, training, reporting hierarchy, internal communications and other supporting documentation.

• Established structured exit and separation procedures supported by practical HR policies and due process upholding principles of natural justice⁴.

• Retained evidence capable of demonstrating the actual commercial impact arising from the employee's conduct.

Adv. Harish Kumbhar and his team practically implement this practise while resolving and handling employment disputes involving clientele across the IT, Fintech, Real Estate, and Manufacturing sectors.

For every dispute Adv. Harish Kumbhar will thoroughly check and re-check every clause, term, contract, agreement, record, correspondence, and document; understand the HR and operational framework of the Company; analyse the Company compliances; research on the latest legal amendments and notifications; and only after this in depth study, Adv. Harish Kumbhar will advise on the legal strategy and merits of the dispute, and in most cases, recommend legal safeguards so that the Company shall be better prepared to address such disputes in the future. 

After more than seventeen years of practice across commercial litigation, employment law, property and conveyancing, family and succession matters, intellectual property and business advisory, he has come to believe that every legal strategy has to be built around the business it is meant to protect.

In his view, the strongest businesses are the ones that build their legal ecosystems before they actually need them.

Then, if litigation does become unavoidable, they enter it from a position of strength and not from a position of recovery.

Employees may leave, but your legal ecosystem determines whether your business leaves with them.

Sources & Footnotes

1. Section 27, Indian Contract Act, 1872, (1981) 2 SCC 246, (2006) 4 SCC 227 ↩

2. (1967) 2 SCR 378 ↩

3. 2006 SCC OnLine Del 638 ↩

4. (1993) 3 SCC 259 ↩