- February 17, 2026
Company Refusing To Accept Resignation? It’s Bonded Labour, Says Kerala High Court
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The court said that forcing someone to remain in employment against their wishes is a violation of Article 23 of the Constitution, which prohibits “bonded labour”
The court made it clear that an organisation’s financial crisis or operational difficulties cannot be used as grounds to deny an employee the right to quit. (Representational Image)
In a significant ruling on employees’ rights, the Kerala High Court has held that employers must accept an employee’s resignation if it is submitted in accordance with the terms of the employment contract, observing that refusing to do so without valid grounds amounts to forced labour and violates constitutional protections.
The observation came during the hearing of a petition filed by a company secretary of a public sector undertaking (PSU), who was not allowed to leave service despite tendering his resignation. According to PTI, Justice N Nagaresh said that resigning from a job is a basic and legitimate right of an employee and that no person can be compelled to continue working against their will.
The court emphasised that if an employee resigns in line with the conditions of service, the employer is bound to accept it. It added that forcing someone to remain in employment against their wishes is a violation of Article 23 of the Constitution, which prohibits “bonded labour”. The court also made it clear that an organisation’s financial crisis or operational difficulties cannot be used as grounds to deny an employee the right to quit.
At the same time, the court clarified that resignation need not be accepted immediately in every case. It noted that an employer may refuse or delay acceptance in specific situations, such as if the employee has not completed the required notice period, if the resignation was submitted impulsively and later withdrawn, if serious disciplinary proceedings or major misconduct cases are pending, or if the company faces direct and substantial financial loss due to the employee’s sudden departure. However, the court found that none of these conditions applied in the present case.
The matter related to Traco Cable Company Limited, a state-run firm. The petitioner, CS Grivas Job Panakkal, approached the court after his resignation was rejected by the company’s board. He said he had not received regular salary since October 2022 and sought to be relieved from service after submitting his resignation in March 2024.
According to PTI, the PSU rejected his resignation, stating that his services were crucial and citing the company’s financial condition. The management repeatedly asked him to return to work and issued memos asking him to explain why disciplinary action should not be initiated against him. The court later observed that the proposed disciplinary proceedings appeared to be an attempt to block his right to resign.
The High Court also took note of the personal circumstances behind the resignation. According to PTI, the employee stated that his father had passed away in 2020 and his mother was unwell, leaving him with family responsibilities and the need to look for another job.
During the hearing, it emerged that the company secretary’s appointment was registered with the Registrar of Companies under the Companies Act, 2013. The court noted that until the employer completed the required statutory filings to record his exit, he would not be able to take up a similar position in another company.
The court reportedly observed that he could not secure new employment until the PSU formally notified the Registrar to remove his name. The court said that withholding acceptance of his resignation in such circumstances directly affected his professional freedom.
The court further ruled that financial difficulties or emergencies faced by the organisation were not valid reasons to force an employee to continue in service. It also recorded that the disciplinary actions initiated against the petitioner were not justified and appeared to be aimed at preventing him from leaving the job.
In its final order, the HC quashed the memos and disciplinary notices issued by the PSU. It directed the employer to formally accept the resignation and relieve the employee from service as soon as possible and within two months. The court also ordered that his pending salary, leave encashment and other service benefits be paid at the earliest, depending on the financial condition of the company.
The ruling reinforces that no employee can be treated as a bonded labourer and that the decision to leave a job is a legal and constitutional right that cannot be denied arbitrarily.
February 17, 2026, 19:04 IST
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