Workplace Law - Case Study Example

?Workplace Law- Case Study The case s that no formal contract or agreement was signed between the employee, Jane Jones and the employer - T Total Mechanic Management Services Pty Ltd. However, according to Common Law, when any firm agrees to hire or employ an individual a contract of employment is said to have been made, regardless of whether it was formally signed or not. Hence all the laws and regulations related to awards, state or federal industrial laws are applicable and can be enforced, in case of such contracts (CCH Australia, 2010). For the purpose of this case study, the contractual true nature of contractual relationship of Jane Jones and TMMS will be studied from the perspective of Common Law, and the various legal issues pertaining to the case will be discussed, by application of principles and facts of the said case. The various legal issues, as pertains to the Common Law, related to this case are listed below: 1. Breach of implied duty of mutual trust and confidence In accordance with the proceedings and decision arrived at by the Supreme Court of Australia, in the McDonald v State of South Australia, it was established that the elements such as mutual trust and confidence are an integral and inevitable part of employment contracts. The judiciary in Australia uses the implied term of trust and confidence in order to create an obligation on the part of the employers so as to instill an interest of fairness. It is described as "an implied obligation of good faith". It was observed in the case of Concut Pty Ltd v Worrel, that "the ordinary relationship of an employer and employee at common law is one importing implied duties of loyalty, honesty, confidentiality and mutual trust" (Aras, Crowther, 2010, pp. 517; Brodie, 2010, pp. 166). In this case, TMMS summoned Jane and made sudden changes in the contract, which included terms and conditions which were unfair to her, and did not seek to protect her interests at work. One of the implied rules of common law states that the employees be treated in a fair manner, while the terms and conditions and the abrupt changes made, were both unfair and unjust for Jane. The employer in this case had an implied obligation to treat their employees fairly and be honest and truthful to them. Furthermore, the employer is also required to practice and apply the elements of confidentiality and strive to maintain mutual trust. But in this case, TMMS decided to restructure its organization and did not take their employees into confidence prior to making any changes to their employment terms, and instead added clauses which were unjust and unfair to them. 2. Refusing to sign, negotiate, extend or vary an AWA Under Common Law, neither the employer nor the employee has the right to unilaterally alter the terms and conditions of an employment contract. Any such alteration must be done through mutual discussion and agreement, else it would be deemed illegal. The employer must obtain a valid consent of the employee prior to changing any of the terms of the employment contract and cannot do so just by serving a notice. Furthermore, it has also been stated under the Common Law, that the courts and tribunals will consider an agreement received by the employer, as illegal if the consequence of non-compliance or non-acceptance to sign the renewed contract is dismissal with immediate effect. In such a situation, the courts will deem such changes to the contract / agreement as unfair and adverse to the interest of the employees (Lewis & Sargeant, 2004, pp. 136). In this case, the employer TMMS, not only changed the terms of contract unilaterally, but also failed to discuss or negotiate the newly added terms with the employee. Furthermore, when specifically asked for more time to consider the said changes, TMMS openly stated that it is a “take it or leave it” situation, and implied that refusing to accept the said changes, would automatically result in termination of the contract. Such harsh terms and conditions not only broke the implied rule of mutual trust and confidence between the employer and employee, but also violated the principle of common law which suggests that any changes to an existing agreement must be made through mutual agreement and / or discussion. Since the employee in this case was left with no option was cornered by the employer, she had to sign the contract, under conditions which were both unfair as well as damaging for her future security. 3. Unlawful termination – termination of an employee without prior notice Such a termination is said to have occurred when an employee is dismissed by an employer without prior notice. Common Law allows / provides for such a dismissal and it is considered perfectly legal (i.e. within the purview of common law), except in the following cases/situations: when the employee is held guilty of misconduct; the employee fails to act in a reasonable manner or follow the commands / instructions applicable to them within the workplace; fails to be faithful to the service; causes damage to the money or property of the employer; discloses employment / trade secrets to competitors i.e. fails to maintain confidentiality of the trade (Fleming, 2004, pp. 146; Caisley, 2008, pp. 70-71). However, in this case the employee Jane Jones was immediately terminated / dismissed from work, as soon as the employers found out about her being incapacitated permanently on account of an accident that took place while on job. The manner and cause of termination are both illegal under Common Law since the employee had not violated any of the terms of her contract. The common law requires the employer to provide a formal notice to the employee prior to terminating their contract or dismissing them from employment. Although, the common law allows for immediate / summary dismissal it does not apply in this case as Jane did not violate any of the terms which attract such a dismissal. Conclusion: The relationship between an employer and employee inherently implies an inequality where the balance of power is tilted in favour of the employers. Hence the elements such as mutual trust and confidence, terms and conditions for unfair dismissal etc are incorporated and enforced by way of common law which applies to all forms of employment regardless of whether the contract was express or implied, and seeks to protect and safeguard the interests of employees as well as the employers. References: Aras, G., Crowther, D., (2010). A handbook of corporate governance and social responsibility, Gower Publishing, pp. 517-518 Brodie, D., (2010). Enterprise liability and the common law. Cambridge University Press, pp. 166-170 Caisley, K. T., (2008). Termination of employment: A best practice guide, CCH New Zealand Limited, pp. 71-73 CCH Australia (2010). Australian master fair work guide, CCH Australia Limited Publication, pp. 466 Fleming, L., (2004). Excel HSC Business studies, Pascal Press, pp. 146 Lewis, D., Sargeant, M., (2004). Essentials of employment law, CIPD Publishing, pp. 136 Read More