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Employers Breach of Contract

An employment contract is a legal relationship which exists between an employer and an employee. It can be verbal (implied), in writing (express) or a mixture of both. The nature of an employment contract may vary depending on the employment status of the individual. For the purposes of this page, it is deemed that the individual is an employee.

What is a breach of contract?
A breach of contract is where a party fails to adhere to a term of the contract, for example, if an employer does not pay salary which is due. A dispute can often arise where there is a verbal agreement or ambiguity in the written contract.

How to resolve a breach of contract
A breach of contract can occur innocently, for example, an incorrect calculation of monies and so an informal approach might be preferrable. Where there is no resolution, an employer or employee can take legal action against the other. An employee may also seek to pursue other claims, such as constructive unfair dismissal. There are strict timeframes for issuing claims.

 

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Should terms be in writing?
The difficulties associated with verbal contracts can be avoided where terms are in writing. An employer should provide a written statement of employment particulars which outlines the main terms of employment, such as pay and working hours. However, many employers will prefer a more robust contract tailored to the needs of the business, for example, extensive notice periods, confidentiality or restrictive covenants.

It is important to ensure that potential disputes can be avoided so far as reasonably practicable and a good way of managing this is to ensure that terms are clear, up to date and well communicated.

What if an employee owes me money?
As stated above, an employer can take legal action against an employee where money is owed. Where a claim has already been issued by an employee, a counterclaim could be made by an employer.

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