Working Remotely for a Foreign Company That Stopped Paying You?

A cross-border principal argued that Indian civil courts lacked territorial jurisdiction because the defendant corporation had no physical brick-and-mortar office in India, and the contract incorporated an overseas jurisdiction clause. The remote service provider established that the intellectual property, professional output, and commercial performance occurred within Indian territorial limits, and consideration was payable into an Indian bank account.

The Division Bench of the High Court held that in modern digital commerce and electronic service delivery, when commercial performance is executed in India and payment is received in India, a substantial part of the cause of action arises within India under Section 20(c) of the CPC. Foreign corporations that avail themselves of services originating in India cannot unilaterally oust Indian courts through boilerplate choice-of-law clauses where the performance is inextricably rooted in Indian jurisdiction.

The claimant worked as a Senior DevOps Architect for a California technology startup via an Indian Employer of Record (EOR) intermediary. When the US client experienced a failed Series A funding round, the EOR summarily withheld three months of salary, accrued leaves, and gratuity, stating that under their Master Services Agreement (MSA), client payment was a condition precedent to wage disbursement ('pay-when-paid' clause).

The Industrial Tribunal rejected the EOR's defense, ruling that under Indian employment legislation and Section 17 of the Code on Wages, the corporate entity that executes the local employment contract, files EPF contributions, and issues Form 16 is the primary statutory employer. 'Pay-when-paid' clauses entered into between commercial intermediaries cannot dilute an employee's statutory right to wages. The tribunal directed the Indian EOR to disburse all unpaid wages alongside 12% penal interest and ₹50,000 litigation costs.

The applicant was engaged as Country Lead for an overseas software firm incorporated in Delaware. The US parent company abruptly shut down remote operations and terminated Indian employees without paying 60-day notice period salaries and accumulated project milestone incentives, contending that the contracts were executed solely by the Delaware parent entity.

The Tribunal held that where a foreign parent company exercises operational control, uses common brand identity, and operates a registered wholly owned subsidiary or captive center in India, the corporate veil will be lifted to protect domestic wage earners. The court attached the Indian subsidiary's current bank accounts until all outstanding employee wages and exit settlements were liquidated in full.

A cross-border dispute involving the enforcement of international arbitral awards and cross-border commercial money debts under Part II of the Arbitration and Conciliation Act, 1996 and the New York Convention, 1958.

The Supreme Court affirmed that international commercial contracts and arbitral awards are expeditiously enforceable in Indian courts unless they violate fundamental public policy. The court reaffirmed that deliberate withholding of contracted consideration for services rendered constitutes commercial default, allowing enforcement through asset tracing and summary decree execution.