Employment Contracts

The Basic Conditions of Employment Act requires every employer to provide its employees with written particulars of employment.  These written particulars include such items as the employee’s occupation, description of work and place or places of work.  It also includes the employee’s rate of remuneration, rate of pay for overtime, and ordinary hours of work, as well as a number of other issues related to the employment of persons.

The Act does not specifically state that an employer must provide the employee with a contract of employment.  A contract of employment is a common law agreement entered into between the employer (offeror) and the employee (offeree) which sets out the basic terms and conditions of employment of that employee.  It is therefore a binding (and legal) agreement and any of the terms therein cannot be less favourable to the employee than those which are prescribed by law (in terms of the Basic Conditions of Employment Act, or a Bargaining Council Agreement, for instance).

The mere fact that there is no written contract of employment between an employer and an employee does not invalidate the employment relationship which might have been in existence for some time.  An employer can insist on a prospective employee signing a contract of employment on commencement of employment (and ideally should do so).  An employer can also provide the employee with a written contract of employment, after commencement of employment, even if the employee has been working for some time without one, so long as the terms and conditions of employment presented in the written contract are no less favourable to the employee as those currently prevailing at the time.

An employer can require an employee to enter into a restraint of trade agreement on commencement of employment as long as such restraint is fair, reasonable, does not conflict with public policy and does not infringe the employee’s constitutional rights to earn a future living in the field in which he is qualified, trained or competent.  Hence an employer may place a restraint on an employee from poaching its customers on leaving employment in order to protect the business’s interests.  The restraint should be for a reasonable period of time and may be restricted to a reasonable geographical area.

An employment contract may comprise a series of documents such as a Letter of Appointment (which is specific to the employee’s starting date, position and commencing remuneration), and a General Terms & Conditions of Employment document, (which is general to all staff).  Part of the Employment Contract should also include a specific Job Description of the employee.

An employer can establish separate Policies and Procedures Documents generic to all staff which can be added to as and when needed.

Where the employer wishes to make any changes to an employee’s or to employees’ contracts, this should be done through a process of consultation with the specific employee or employees.  If employees belong to a trade union, which negotiates terms and conditions of employment for its members, then obviously these changes should only be made after due negotiation with the representative union.

Where an employer unilaterally changes an individual employee’s contract (or a number of employees’ contracts) to his or their detriment (without consultation) this could amount to a breach of contract.  Where such breach makes continued employment intolerable, the employee could sue for constructive dismissal, if after having tried to address the changes with the employer, the employer refuses to reinstate them.

The law on employment contracts and labour law in general can be a complex issue.  Seek professional advice, whether you are an employer or employee, before making rash decisions.