Upon starting a new job, you enter into a contract with your employer. This employment contract states specific terms, obligations, and rights for both parties involved. These agreements legally bind the employer and employee, meaning that a breach of contract may result in legal action.
An agreement may be verbal or written, however it is always more advisable to have a physical copy of an employment contract to use as definite proof or evidence if a breach of contract occurs.
What does it mean to breach a contract?
Depending on the severity of the offense, the innocent party may be allowed to file a case. In this case, they may ask for compensation for financial losses and damages caused by the breach. They may even file to have the contract terminated as soon as possible.
What to do if the contract is breached?
If you are an employee, there are certain courses of action that will be considered as your employer breaching your contract. Some of these instances include:
● Dismissal without prior notice. Most companies are mandated to give their employees a notice of termination at least a month before the intended termination date.
● If your fixed-term contract was terminated before the agreed upon term ends and your employer fails to give you a reasonable notice.
● If you are dismissed due to misconduct without basis or evidence for such accusations made against you.
● Forcible resignation due to harassment or discrimination in the workplace. This is especially applicable to cases in which it is the employer or superior that is harassing you.
These cases will usually result in compensation for damages, due to wrongful dismissal on the employers’ part. The employee may also opt to bring the case to common law court and the territory industrial relations commission. Before filing any claims, make sure that you are prepared with the following information:
● The source of your right (this can be in the form of your employment contract or a copy of your local law or industry regulations)
● Your employer’s business structure
● Your salary and benefits
● The amount of compensation you seek
On the other hand, if you are an employer, there may be times when a member of your team breaches their contract. You are also fully entitled to file for compensation for losses and damages. Below are some common reasons for employers to file cases against their workers:
● The employee has divulged confidential information about the employer
● Breaking a valid trade clause stated in the contract
● Causing further damages against the company and the employer himself
Why do we need contracts?
Employment contracts are not only important, they are absolutely necessary, as it details the expectations that the employer and employee have for each other. It also serves as protection against negligence and abuse for both parties involved.
Having a contract means that your agreement is legally binding. You can be sued if you don’t hold up your end of the contract that you had agreed to. Contracts are put in place not just at jobs, but also between businesses and clients, companies entering a partnership, and more along those lines.
There also comes a sense of trust and security after a contract is made official and signed. Both parties are 100% obligated to follow what the contracts entails, and both can easily go to court when one or more parts of the contract are not followed.
It is crucial that you know your rights and obligations before signing a contract with anyone. It would be in your best judgment to seek the advice of a professional and talk to an employment lawyer, regardless if you are an employee or employer. They will guide you through the necessary steps and make the entire process much smoother.