Breaches of Employment Contract

An employment contract is legally binding on both employee and employer. An employment relationship is also regulated by certain workplace policies, which have a crucial role to play in creating and maintaining a harmonious and efficient workplace environment. Conditions of employment and work policies may be breached by both the employee and employer. In such cases, both the employee and employer may take a number of remedial actions. If an employer alleges that the employee is in breach of a contractual term, the breach may be a ground for dismissal of the employee; if the employee alleges that the employer is in breach, the employee may resort to the remedies available.

A breach may be of a written employment contract, as well as a breach of verbal agreed terms between employer and employee. In the latter, all the facts and circumstances would need to be assessed to allege that there is a breach of these verbal terms.

Parties may choose to resolve the issue either formally or informally, with actions ranging from mediation, settlement agreements to legal action, to arbitration and finally through the civil courts.

Conditions of employment include wages, the period of employment, the hours of work and leave, and includes any conditions related to the employment of any employee under a contract of service, including any benefits arising therefrom, terms of engagement, terms of work participation, manner of termination of any employment agreement and the mode of settling any differences which may arise between the parties to the agreement.

The law also establishes recognised conditions of employment, which are conditions of employment prescribed in a national standard order, or in a sectoral regulation order, or a collective agreement or determined by voluntary settlement or required to be observed by the Employment and Industrial Relations Act.

Breaches of Contract by the employer

If an employee alleges a breach of contract by the employer, the employee may forward his/her claim, which must be supported by documents, to the Department of Industrial and Employment Relations (DIER) which will investigate and take the necessary steps.

Criminal action can only be instituted by the Department within a prescriptive period of one year. This does not prejudice the employee’s right to institute civil action against the employer according to civil law. An employee may also institute an action within the civil court, instead of seeking the assistance of DIER.

In case of alleged unfair dismissal, discriminatory treatment, breach of the principle of equal pay for work of equal value, victimization, harassment and all the cases which refer to the Industrial Tribunal, the employee as a private individual can institute action before the Industrial Tribunal.

In case of recognised conditions of employment, if these are contravened, unless a different penalty is established for such an offence, the employer is liable to a fine (multa) of not less than €232.94 and not exceeding €2,329.37.

Breach of contract by employee

Where an employee is alleged to breach the employment contract, this may well result in a disciplinary process, which may also lead to dismissal. The employee is to seek legal advice should it have any doubt as to the fairness of a dismissal.

Although an employer can also pursue the employee for damages, this can only be in respect of financial loss which they have suffered as a result of the breach.