Working in AILesson 63 of 85

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Working in AI

Lesson 63 of 85. Sign in to keep your place.

Module 7 · The money, and the paperwork underneath it

Notice, bonds, IP and the clauses that follow you

10 min read

The only moment you have leverage

Between the offer and your signature, a company that has spent six weeks choosing you would rather amend a clause than restart. After you sign, you are asking a favour. Read the contract in that window, once, properly. It takes forty minutes.

What follows is the shape of the common clauses and how they differ between countries. It is not legal advice, employment law differs by jurisdiction, and for anything unusual or expensive you want an actual lawyer. Many bar associations and legal-aid clinics offer free or low-cost initial consultations.

Notice period

The gap between resigning and leaving. Two weeks to a month in much of the US and Europe at junior levels; 60 to 90 days is standard in Indian technology employment and it is a real cost, because a company that wants somebody in three weeks will not wait three months, and you will lose offers to it.

Look for: notice during probation (usually much shorter), whether the employer can require garden leave (paid but not working, which protects them and freezes you) and whether there is a buyout option letting you pay to leave earlier. Buyouts are common in India and the new employer sometimes covers them; ask.

Training bonds and service agreements

Common in Indian IT services and in some Gulf employment: you agree to stay for a period, or repay a sum, usually framed against training given.

The legal position is contested and jurisdiction-specific. In India, Section 27 of the Indian Contract Act voids agreements in restraint of trade, and courts have generally been willing to enforce a bond only to the extent of the employer’s genuine, demonstrable costs, not as a penalty, and not where the amount is unconscionable. That is a general shape, decided case by case, and not a promise about your contract.

What to do before signing: ask what the sum covers, get the figure and the period in writing, and be clear that “we will hold your original certificates” is a practice you should refuse. Retaining original educational documents is not a legitimate security and in several jurisdictions is unlawful.

Non-compete

Highly jurisdictional, and the differences are stark:

  • India: post-employment non-competes are generally void under Section 27. Confidentiality and non-solicitation clauses are treated differently and are more likely to hold.
  • California: non-competes are void by statute, which is a substantial part of why Silicon Valley’s labour market works as it does.
  • Germany: enforceable only if the employer pays you at least 50% of your previous compensation for the duration. A non-compete with no compensation is not binding.
  • United Kingdom: enforceable if reasonable in scope and duration, typically three to twelve months, and courts do strike down overreach.
  • United States generally: the Federal Trade Commission’s attempt at a national ban was blocked in court in 2024 and the position remains unsettled and state-by-state.

The practical point is that a clause existing in your contract does not mean it would be enforced, and that a clause you cannot afford to litigate constrains you regardless. Both things are true at once.

Intellectual property assignment

Almost every technology contract assigns to the employer the intellectual property in what you create during employment. The variation is in the edges, and the edges matter to anybody with a side project or an open-source habit.

Watch for language covering anything created “during the term of employment” without limiting it to work using company time, equipment or subject matter. Some jurisdictions limit this by statute (California’s Labor Code §2870 protects inventions developed entirely on your own time without employer resources and unrelated to their business) and many do not.

What to do: list your existing projects in an annexe as prior inventions excluded from assignment, and ask for a written carve-out for personal open-source work. Reasonable employers agree. The request is normal and the moment to make it is before signing.

Moonlighting

Clauses restricting outside work have tightened considerably, particularly in India since 2022, where several large employers made dismissals over dual employment. Some contracts prohibit any paid outside work; some require written permission; some prohibit only competing work.

If you intend to freelance, teach, or take a second contract, read this clause specifically and get any exception in writing. “My manager said it was fine” survives exactly as long as your manager does.

Probation

Usually three to six months with shorter notice on both sides and sometimes reduced benefits. Confirm what happens at the end (is confirmation automatic, is there a review, can it be extended) because an extended probation is a signal that arrives too late to act on.

The one habit

Read the whole thing before signing, mark anything you do not understand, and ask. Asking three clear questions about a contract has never cost anybody an offer, and every experienced employer expects it.

Every lesson here is open. Your progress is recorded once you pass the AI at Work exam.

Check your understanding

An offer contract assigns to the employer all intellectual property created “during the term of employment”, with no limitation. The candidate maintains a popular open-source library. What is the right move?

Pick the one you would defend. Your answer stays private.

Next lesson · 9 minEmployee, contractor, or an employer of record

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How to cite: Addaly (2026) ‘Notice, bonds, IP and the clauses that follow you’, in Working in AI. Edited by M. Mun. Addaly. Available at: https://addaly.com/learn/ai-careers/the-contract-you-sign (Accessed: 13 October 2026).