IBM India is asking for $5500 penalty amount for resigning in US

Hi, I came to onsite through IBM India on L1 Visa. I recently got my H1B done through some other employer and resigned from IBM India here in US. IBM asked me to server 60 days notice period or pay $5500 penalty.I didn’t server 60 day notice period and quit. They have forwarded my case to a collection agency which is calling me to pay $5500. This clause of serving 60 day notice period or $5500 penalty was mentioned in my offer letter which I got when i came to onsite.

There is no way one can server 60 day notice period because once you get your H1B approved you can’t work on L1 anymore. You can’t even resign till your H1B is approved. This is a trap and employee has no option but to quit without serving 60 day notice period

Just want to know if these types of demands are valid in US? Should i file a complain with USCIS or department of labor ?

Senior members please suggest

Thanks in advace


No one can legally ask you to pay for H1b fees. Contact a lawyer immideatly and take further action.

Hi SnowWinter,

This is not about H1B fees.IBM is asking to pay a penalty of $5500 for not serving 60 days notice period. I didn’t pay this amount and quit. IBM is not going to give me experience letter if I don’t pay them this amount .Now i have started working for my new employer. They have forwarded my case to a collection agency which is calling me to pay $5500.

Just wanted to know if these kinds of conditions or demands are valid in US? Do I really have to pay them $5500 penalty amount ?

Employment in US is always at Will! i.e. they can fire you or you can leave at any time. AFAIK they cannot charge you for leaving. One sided contracts cannot be held in court of Law. Thats why contact a lawyer and tell him that collection agency is harassing you ( you can sue them). In US no body asks for experience certificate ( unlike India).

Thanks a lot SnowWinter for your response. I am going to contact a lawyer and seek his advice on this matter.

L1 visa is meant to be intra company transfer so when you joined them and accepted the offer letter, you also agreed to all their clauses which is to serve notice period or pay certain amount.

I’m sure a company like IBM would have thought this through before handing over to collection agency. They may be right . I would suggest you to talk to IBM and discuss a settlement amount that you can pay.

These are my thoughts only. I may be wrong.

Hey Rahul,

I am also in the same situtation, are they still bothering you? please adivice what next?

Hi Rahul, please let us know did IBMI create any issues later? Did they create any legal problems to your career in US?

Hi Rahul,

I am also similar situation IBMI asking 10K not serving notice period of 90days which is not possible in US , Collection agency sent me 3 letters asking me to Repay amount.

How did you handle this one ? Will there be any effect on my Credit or Green card processing due to this?

Yes, I agree. IBM is known for including clauses in their contracts which are hard to break, be it an employment contract or their Product or Support contract agreements. So I would tread carefully in this matter and through an attorney.

Hi Rahul,

I am also in the same boat. How did you handle this? Is it necessary to pay $10K to IBM in this matter?

Hi Rahul,

I am also facing exact same situation right now and I would like to know your experience what would happen if I do not pay the usd amount. I am serving 45 days of notice period and still they are not negotiating the amount.