Common Legal Issues Involved with Employment Contracts
Added on 2020-10-22
11 Pages3506 Words220 Views
Business Law
Table of ContentsINTRODUCTION...........................................................................................................................31. Issues pertaining to Employment Contract and law................................................................32. Legal issues involved pertaining to equal pay in an organisation...........................................53. Implications of working conditions under Health and Safety Regulations.............................8CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11
INTRODUCTIONBusiness law is a law encompassing various other laws ranging from initiation of abusiness to running a business. It is often called as mercantile law or commercial law whichdeals with the individuals and various commercial transactions, such as law of contract, tort,employment law etc. The business law pertaining to managers is the stream of law which dealswith the decision making in a business by the people who are responsible for managing andorganising business. The report covers various aspects of business law starting from employment law (Guestet. al, 2010) to equal pay to health and safety regulations and legislations, which are required tobe complied by any organisation to successfully run and manage a business and protects it fromthe legal implications faced due to non-compliance. These laws are assessed by its application inaddressing the issues posed to the organisation Chia Ltd.1. Issues pertaining to Employment Contract and lawIntroductionIn the organisation Chia Ltd., the director Mr. Joseph has employed a person, named Mr.Dwayne, for the position of secretary in the company, who has been working in the companyfrom past six weeks. There was no formal written agreement entered into by the employer-employee and the arrangement between them on the terms of contract was purely verbal. Anemployment contract is an agreement between an employer and employee which forms the basisof their employment relationship. An employment agreement is usually made orally when theoffer is accepted to work and not reduced into writing. And, advice is sought in the givenproblem pertaining to legal requirements of a written employment contract.LawIn the UK the governing legislations on employment law are – The Employment Rights Act, 1996The Employment Act, 2002the Employment Act, 2008The section 230 the Act, 1996 states that a contract could be express or implied. Further,it provides under section 1 of the Act, 1996 that every employee is entitled to a written contractspecifying the terms of employment and it is the duty of an employer to provide the employees3
with a formal written statement consisting of the terms of employment within two calendarmonths from the beginning of work of the employer. (MacLeod, 2010) The written contract musthave a description of the terms such as, name of employer-employee, job description, date &place of work, pay, working hours, disciplinary rules etc. AssessmentA contract is an agreement between two parties which is enforceable by law and thebreach of its terms attracts legal implications and the party injured can claim damages. Similarly,an employment contract is an agreement between the employer-employee stating the terms ofemployment. The Employment Rights Act, 1996 clearly states in the interpretation clause undersection 230 (2) that a 'contract of employment' is a contract of service or apprenticeship whichcould be express or implied and if the contract is expressed then it is either written or oral. TheAct, 1996 section 1 states that each employee is entitled to a written statement of the terms ofemployment by the employer from the staring of work by the employer.Though, the law describes that the contract of employment could either be written or oralbut it is always advised that the terms are reduced to writing as it gives clarity as to the terms ofemployment and provides legal sanctity to the elaborate terms which does not fall under theprotection of law. A contract covers the rights and obligations to be abided by the employer andemployee such as the health benefits, vacation and sick leaves, safety regulations, minimumnotice periods, other legal compliances, etc. Similarly, the importance of contractual terms wasdecided in the case of Thomas Wylie McCulloch v Chief Constable Dumfries and GallowayConstabulary [2005] UKEAT 0891_04_2109. The plaintiff claimed a special allowance from theemployer which was not part of the contractual terms. The Employment Tribunal and AppealsTribunal refused to entertain the claim only on the ground that the allowance was not specificallymentioned into the terms of contract. Therefore, a formal written contract is always appreciatedwith clear terms of employment whenever any dispute arises between the employer andemployee.The status of employee is important as whenever an employee acquires the status of anemployee he is entitled to certain benefits and the employer is under a duty to fulfil certainobligations. The employment status determines that the employee is entitled to the employmentrights, for instance, an employee cannot be unlawfully and unfairly dismissed. Similarly, it wasobserved that the employment status of the defendant was in question in the case of Pimlico4
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