Employment contracts are a fundamental part of the employer-employee relationship, outlining the rights, responsibilities, and duties of both parties. However, not all terms of an employment contract are explicitly stated. Some are implied, forming an integral part of the agreement without being expressly mentioned. These are known as implied terms of a contract. Understanding these implied terms is crucial for both employers and employees to ensure a fair and effective working relationship. This article will delve into the concept of implied terms in employment contracts, their significance, and how they operate within the legal framework.
Understanding Implied Terms
Implied terms are provisions that are not explicitly stated in a contract but are understood to exist due to the nature of the agreement. They are often not written or spoken about but are considered an essential part of the contract. These terms can be implied by fact, law, or custom and practice. They are designed to define business efficacy, ensuring the contract can function as intended.
Implied Terms by Fact
Implied terms by fact are terms that are considered so obvious that they do not need to be stated. They are assumed to be part of the contract because they are necessary for the contract to operate effectively. For example, it is an implied term that an employee will not steal from their employer, even if this is not explicitly stated in the contract.
Implied Terms by Law
Implied terms by law are terms that are automatically included in a contract by virtue of legislation or common law. These terms are designed to protect the rights of both parties and ensure fairness. For instance, under UK law, it is an implied term of every employment contract that an employer will provide a safe and healthy working environment.
Implied Terms by Custom and Practice
Implied terms by custom and practice are terms that have become part of the contract due to consistent and longstanding practices within a particular industry or workplace. These terms are generally accepted as part of the contract, even though they are not expressly stated.
Common Law Obligation of an Employee
Under common law, employees have certain obligations that are implied in every employment contract. These include the duty of fidelity, which requires employees to act in the best interests of their employer, and the duty to obey reasonable and lawful orders. These implied duties of employees are fundamental to the employment relationship and are enforced by the courts.
Employer Obligation in an Employment Contract
Similarly, employers also have implied obligations under an employment contract. These include the duty to pay wages, the duty to provide work, and the duty of mutual trust and confidence. These obligations are designed to protect the rights of employees and ensure a fair and productive working environment.
Difference Between Express and Implied Contract
Express contracts are agreements where the terms are clearly stated by the parties, either in writing or orally. In contrast, an implied contract is one where the terms are not expressly stated but are inferred from the conduct of the parties or the circumstances of the agreement. For example, an employment contract may be implied when an employer continues to pay a worker for their services, even though there is no written agreement.
Implied Contract Terms
Implied contract terms are provisions that are not explicitly stated in a contract but are understood to exist. These terms can be implied by fact, law, or custom and practice. They are designed to ensure the contract can function effectively and fairly.
What Should Be Included in a Contract of Employment in the UK
In the UK, a contract of employment should include the following terms:
- The names of the employer and employee
- The date the employment started
- The employee’s job title or a brief description of the work
- The place of work
- The amount of pay and how often it will be paid
- The hours of work
- Holiday entitlement
- Sick pay arrangements
- Notice periods
- Information about disciplinary and grievance procedures
These are the express terms of the contract. However, there will also be implied terms, such as the duty of mutual trust and confidence, which are not stated but are an essential part of the agreement.
Conclusion
Understanding the concept of implied terms in employment contracts is crucial for both employers and employees. These terms, which may not be expressly stated, form an integral part of the agreement and can have significant implications for the employment relationship. By being aware of these terms, parties can better understand their rights and obligations, leading to a more effective and harmonious working relationship.
