A Contract of Employment - Essay Example

Serapio Maria Perpetua A. Serapio Academia-Research TOPIC: EMPLOYMENT ASSIGNMENT EMPLOYMENT WORK Research Project) 2008-9 December 10, 2008 EMPLOYMENT I. Under the Employment Rights Act of 96, the requirement for the employer to provide a statement of terms of employment to an employee is to provide the employee and the employer an equal opportunity to have a concrete document in relation to the employment. It specifically indicates the following: (1) Statement of initial employment particulars; (2) Statement of initial particulars: supplementary; (3) Note of disciplinary procedures and pensions; (4) Statement of Changes; (5) Exclusion from rights to statements; (6) Reasonably accessible document or collective agreement; (7) Power to require particulars of further matters; (8) Itemized pay statement; (9) Standing statement of fixed deductions; (10) Power to amend provisions about pay and standing statements; (11) References to industrial tribunals; (12) Determination of references.1 An employment agreement is a vehicle to provide clarity with regards to the parties' expectations for the employment relationship.2 It specifies what both parties, namely the employer and employee, must understand and what to expect concerning the duties and ______________________ 1 Employment Rights Act 1996(c.18 2 Dorsett v Cross, 106 S.W. 3d 213, 217 (Tex. App. 2003) Serapio 2 responsibilities, on, benefits, and grounds to terminate the relationship. Appurtenent thereto, an employment agreement can clearly define an employee's incentives to perform, such as requirements for bonus, commissions, evaluations, performance goals and objectives and consequences for failure to meet the goals and objectives of the company. An employment agreement can also confirm the status of employment. 3 This may at will or at a specified term, length of term of employment. The employer can clearly define the minimum commitments and obligations for both the employer and employee and , if the agreement is well drafted, this can minimize disputes based upon the termination of the employment relationship by clearly setting forth the terms under which the employer and employee may separate. Under the law employers are required to give their employees a written statement with regards to the details relating to the contract of employment. 4 However, the law does not prescribe the actual substantive content of the terms of employment as long as it does not divert from the objective of the law. It is stipulated that what is actually required is that the particulars can be set out in a formal contract or written statement. It must indicate the particulars in a single document but cross-reference can be made to other documents in respect to sickness and pensions entitlements and disciplinary and grievance procedures. These documents should be easily accessible such as in a employee handbook and pension rulebook. The data that must be indicated in the written contract of employment must include the name of the employer and employee, the date when the employment is to commence, the rate of renumeration, the schedule at which the renumeration is to be paid, terms and conditions relating _____________________ 3 Black's Law Dictionary 75 (8th Ed. 2004) 4 Employment Rights Act 1996 (c. 18), part 1, Employment Particulars, Right to Statements of Employment Particulars Serapio 3 to hours of work, holidays, holiday pay, sick pay, pension schemes, notice entitlements, job title, term of employment, place of work, details of disciplinary and grievance procedures and details of any collective agreements which affect the terms and conditions of the employment. Subsequently, the written agreement contract must be given not later than two months after the beginning of the employee's employment and any changes thereat must be relevant to the matters which must be confirmed to the employee by way of a written notice to be given at the earliest opportunity and in any event not later than one month after the change takes effect. The legal position with regard to any such changes should not be disregarded. The notice given to the employee does not necessarily in effect render the contract effective.5 In the event that the employer fails to give the employee a statement of terms or a contract of employment, there is no financial penalty set thereat. However, the employee's remedy is to petition the Employment Tribunal for a declaration as to what the specific terms and conditions of his or her employment. 6 This in effect will give him or her a right to seek a declaration of his/her contractual rights with respect to his/her employment. It is to the best interest of all concerned that an employer must always give a written contract of employment to all employees. In the event that there is no particular employment contract applicable to an individual in relation to a particular item, this should be stipulated in the said contract.7 2. Under the law certain contractual terms may be implied in addition to the stipulated terms that have been agreed upon by both parties, namely the employer and the employee. In the said ____________________________ 5 Restatement (2nd) of Contrats #205 (1981) 6 Airey vs Ireland (1979) 2 EHRR 305 7 Boyce, George, Acas D & G Code Revision, May 2008, Draft For Consultation Draft Acas Code of Practice on Discipline and Grievance Serapio 4 contract of employment it indicates the terms which will bind both parties in relation to the employment conditions pertinent to the contracts, either by the courts, by statute, by custom or by usage. 8There are contractual terms that have been reviewed by the courts in relation to the interpretation of a particular provision stated therein. 9 This was done so to prevent any injustice that can be made upon in the event a question of law with regard to the interpretation of the express provision of the contract is involved. 10 While it is a settled jurisprudence that a court has the power to imply terms into agreements, there is no law stipulating to the contrary that the contracting parties can expressly exclude particular provisions in their contract that would not be adequate in their particular need and situation.11 There are particular terms that an employee is implied to do in the business relationship between the parties which is a necessary factor in the smooth operation of the business, 12 It is a standard operating procedure that the contractual terms are always binding to the parties which are always stipulated in the existing jurisprudence in labor relations. An example to that effect are the various consumer rights on sales contracts under the Sales of Goods Act 1893.13 This law states that the sales of a description, it is an implied contractual term by statute that the goods should answer the description and be merchantable quality. In the Statute law, it defines the aspects of common law, and gives rights to the parties, implied into the contract, that they have the right to repudiate or rescind agreements pertinent thereto and the right to sue for damages in respect to any breach of contract thereat. In the foregoing, it is not uncommon for sellers demand the express exclusion of the operation of implied terms of statute. However, there are particular implied terms related to consumer rights that cannot be excluded or limited. _________________________ 9 Devonald vs. Rossen & sons Ltd, (1906) 2 KB 278 10 Freeland, M. (Oxford: Clarendon Press, 2003) at p-. 19, The Present Employment Contract 11 Shebbings vs UK (1996) 23 EHRR 213 12Whitfelld vs General Medical Council (2002) UK PC 62 (2003) 13 Sales of Goods Act 1893 Serapio 5 It must be remembered that contracts can also be subject to terms founded by custom or usage through the course of dealings, though not expressed by parties concerned. A custom can be incorporated into a contract only if there is nothing expressly or impliedly stipulated in the terms of the contract that can otherwise prevent its inclusion. Customs are often a part of a particular trade or a business sector, but to have effect, they must reinforce and assist the agreed contract terms thereto. Therefore, implied terms are a very important part of contract law and it is essential for business and contractual efficacy that there is some inclusion into the expressly agreed contractual terms of both parties concerned.14 3. A contract of employment is a contract between an employer and an employee whether it is written or not. A written contract is known as "expressed contract" while an unwritten contract is known as an "implied contract." There is no discrepancy whether a contract is expressed or implied because both these types of contracts must adhere to the rights of the employer and the employee under the stipulations of the contract set forth between these two parties.15 In an employment contract there are also duties that are express or implied. In most cases implied duties are not stipulated in every employment contract on the other hand there are some express duties that are indicated in employment contracts. 16 It is imperative upon the employee to find out whether or not there are certain duties and functions of a certain job that are not written down specifically indicated in the job description of the contract. There are instances that these may be included in the employee's manual.16 It must be remembered that an employee's manual ______________________ 14 Dorsett v. Cross, 106 S.W. . 3d 213 (Tex. App . 2003), 15 Adams v G.J. Creel & Sons, Inc., 465 S.E. ed 84, 85 (S.C. 1995), 16 Adams., supra 16 Halford vs United Kingdom (1997) IRLR 471 Serapio 6 is not of the same level of importance as an employment contract but it is apparent that every employee must adhere to the policies set in the said manual as a matter of procedure. Under the employment conditions, an employee has numerous duties many of which are either defined in a contract of employment or a policy manual. Therefore, it is best that an employee should diligently check now and then the guidelines set therefor. The duties of an employment relationship whether there is an employment contract or not are good faith and fidelity; care, skill and competency; and confidentiality.17 It is the duty of every employee not to work for another employer during the term of his employment, to behave properly and observe proper ethical standards and decorum in the workplace, to avoid conflicts of interest - such as working for a competitor company, and it is the basic duty of an employee not to act in any way that is inconsistent with the interests of his/her employer at all times.18 This emphatically means that an employee must be faithful to the employer and work for the employer's best interest. 19 It must always be remembered that under the presumption of good faith and fidelity, that the work of every employee is the property of the employer. In other words, the employer is paying for the work being done by the employee therefore it is no longer the employee's work to claim as his. In the performance of his work, the employee must have the necessary skills to perform his/her job and an employee must have diligence and care in the performance of his/her duties and functions. It is therefore understood that employees are not perfect and thereby make mistakes so __________________________ 17 Spring v Guardian Assurance PLC (1994); Corr v IBC Vehicles Ltd (2006) EWCA CIV 331 18 Hivac v Park Royal Scientific Instruments Ltd (1946) I AII ER 350 19 Secreratry of State v Aslef No. 2. (1972) 2 AII E. R., 949 Serapio 7 there must be a leeway and the employee , just because he made a mistake in the performance of his job cannot be unjustly terminated without just cause. One important guideline that must be remembered is that an employer may have a policy in effect to deal with issues of work performance and if an employee continuously goes against that policy if may be grounds for termination.20 One of the most important things an employee must remember is that he/she must keep his/her employer's information confidential and cannot use the information for his/her benefit.21 Some of these confidential information are client lists, trade secrets, and some other secrets that are important in the performance of the business. 22There is a thin line in determining confidential information. It is therefore very important that employees always check their employment manual to verify these confidential clauses.23 According to studies made on labor relations, the most highlighted is the implied obligation of "trust and confidence" as to the terms of an employer's implied duty under common law. This has made potential consequences as an aftereffect from a breach of such implied term which exists in every contract of employment. 24 According to the common law, an employer must never, without reasonable and proper cause, conduct itself in a manner that would destroy the relationship of reasonable and proper cause reasonable and proper cause, conduct itself in a manner that would destroy the relationship of trust and confidence between the two parties, the employer and employee.25 ____________________________ 20 Spring v Guardian Assurance PLC (1994); Corr v IBC Vehicles Ltd (2006) EWCA CIV 33 21 Faccenda Chicken v Fowler (1987) 1 CH117 (Ch App. 1985) Eng CA 22 Boston /Deep Sea Fishing and Ice Co. v Ansell , 39 Ch D. 339 23 Lion Laboratories Ltd v evans, (1985) QB 526, 550, per Grd 26 Human Rights Act 1998 27 Malik v BCCI, (2000) Part 3 Cas 1 (HL) Serapio 8 At the employer's part , to be liable for breach of trust and confidence he must have committed the following to wit; (a) That the employer must have conducted himself in a manner that would entitle an innocent employee to leave at once. ( That in the case of a court case, the court must be convinced that there was no reasonable and proper cause for the actions of the employer's conduct); (b) That the employer's conduct must be calculated to destroy or seriously damage the degree of trust and confidence the employee is reasonably entitled to have in is or her employee. The conduct that would destroy the trust and confidence of an employment that would amount to a breach of the implied obligation is broad. 28 However, there are certain norms that the conduct complained of must amount to a breach of employment contract in a fundamental aspect. This action must be the compelling reason for an employee to resign. The conduct that results in constructive dismissal falls within the following categories such as: (a) operating a dishonest or corrupt business; (b) treating an employee in a brutal manner; (c) subjecting an employee to an oppressive work regime, denying him/her of proper rest days and regularly pressing him/her to obey unreasonable or unlawful work Under the common law, employers must always engage in reasonable and proper cause in ___________________ 28 Malik v BCCI, supra Serapio 9 the conduct of their business and be careful not to destroy or seriously damage the relationship of trust and confidence with their employees. 29 On the other hand, employers may have no obligation to improve their employee's future job prospects, employers must not in any way conduct themselves in a manner that would damage their employee's career or cause them to suffer any continuing financial losses by harsh or oppressive behavior in the workplace or during their employ.30 In view of the above cited provisions on confidential information, restraint of trade ad departing employees, it is hereby placed upon the employee that it is his/her duty not to disclose, either during or after termination of employment, any trade secrets in their possession (knowledge) related to the employer's business. Care should be taken to identify or specify in the contract of employment what constitutes the broader concept of the meaning of confidential information which employees are contractually obliged not to devulge after termination. This can be obligation can be imposed by an injunction and proceedings can be taken to recover documents and property improperly retained by any departing employee.31 According to the Public Interest Disclosure Act 1998, it protects persons from any legal action or dismissal in relation to protected disclosures where it is believed that a miscarriage of justice has occurred or that a crime has been committed thereto.32 It is therefore important there must be express terms of the contract of employment, to impose restrictive provisions restricting the ability of an employee, after the termination of his ________________________ 29 Bell v Lever Bros, 155 S.W. 2D 540 (Mo App 1941) 30 Faccenda Chicken v Fowler, supra 31 Nordentfelt v Maxim Nordenfelt Guns & Ammunitions Ltd., (1894) AC 535 per Lord Macnahtaen 32 Public Disclosure Act 1998 Serapio 10 employment. However, in order to insure that such provisions are enforceable, it must be clearly indicated therein. They will only be enforced if they protect the employer's goodwill and customer connections and are reasonable in terms of their duration and geographical application. 4. Conclusion. It is the best practice for both employers and employees that they perform entirely and conscientiously whatever work has been voluntarily and equitably agreed upon; not in any way to injure the property or harm the person of employers. They must always protect the interests of the workforce. On the other hand , employers must treat their workers as decent human beings and not as slaves. Justice demands that the dignity of the human personality must be observed at all times. The most important duties of employers is to give the workers what is due to them. Assuredly, to establish a rule of pay in accord with justice. In general, the employers should remember that no laws, either human or divine, permit them for their own profit to oppress the needy and the wretched or to seek gain from another's hardship. 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