The following articles should provide you with more information.
Breach of Contract (Part 1)
A problem that often arises in the workplace is when one party to a contract breaches the contract of employment by contravening a section or sections of the contract, or fails to comply with one or more provisions of the contract.
Firstly, it must be understood that a Contract is an agreement between two or more people. In our case it is an agreement between the employer party on the one hand and the employee party on the other hand.
Should one of the parties to the agreement fail to act in terms of the agreement, or indeed act in contravention of any of the terms of the agreement, without the agreement of the other party, then that party is said to be "in breach of contract."
In other words, the party in breach has broken the terms of the agreement. In some cases, it might be construed that the party in breach has in fact repudiated the entire contract.
A contract of employment can be breached in many different ways by either party.
For example, a contract stipulates that a notice period of 1 month is required by either party wishing to terminate the contract. The employee walks out on 24 hours notice â€“ that woulod place the employee in breach.
If a contract stipulates that salaries will be paid on a certain date, and the employer fails to pay on that date without valid reason, then the employer may be in breach of contract.
Basically, a material breach of any condition or term in the contract may place a party in breach of that contract.Generally, any infringement by one party to the contract on the contractual rights of the other party to the contract, may constitute a breach of contract.This may be one of the reasons why employers seem so reluctant to enter into a written contract of employment with employees.
Based on our experience, this reluctance is not the exception â€“ it is very common for employers to simply not enter into a written contract of employment.
One of the reasons may be that the employer is under the incorrect impression that when the terms and conditions of employment are reduced to writing, then the employer is "tied down." Whilst that may be true, and it is also true that labour legislation (apart from section 29 of the BCEA) makes no provision compelling an employer to enter into a written contract of employment, the absence of such a contract does not make the employer any less "tied down" that he would be if there were such a contract in place.
In fact, it is our view that the absence of a formal contract of employment places the employer in a far more dangerous position that if there were such a contract. Just for a beginning, no contract basically means that the employee is not really bound by any terms and conditions of employment. Within certain parameters, the employee is almost "his own boss".
For example, what would an employer's reaction be to an accountant who has been employed for 5 years, with no written contract of employment, walks out on 24 hours notice on 27th February â€“ the day before financial year end ?
Breach of Contract (Part 2) It would seem that, if our e-mail "free advice" facility on our website is anything to go by, breach of contract is on the increase â€“ by both employer and employee parties to the contract.
On the employee side, the most common and increasing breach is on the notice period. Most contracts stipulate at least the statutory notice periods, and others may have different requirements.
What ever the case, it is becoming very common for an employee to find other employment, wait for his salary to be paid at month end , and then next day he/she sends an SMS or e-mail message to the employer, stating that "I have resigned and will not be coming back. Please pay my leave pay and pension benefits into my bank account."
This practice is not uncommon, and is on the increase. Thus, although the employment contract may stipulate a longer notice period, the employee has terminated the contract on 24 hours notice, thus placing himself in breach of contract.
In addition, to give 24 hours notice is unlawful and in contravention of the Basic Conditions of Employment Act (section 37) which makes no provision for 24 hours notice.
Employees have learned that if they give 24 hours notice and walk out, the employer is not permitted to hold back any money in lieu of notice, and the employer is required to still pay the employee the salary up to the last day worked, plus any outstanding leave pay, pro-rata bonus (if applicable), and any accrued pension or provident fund benefits.
The employee who walks out on 24 hours notice may also be seen to have deserted â€“ if the employee has notified the employer that he will not be resuming employment at a future date, then obviously that employee has no intention of returning to work.
It may be said then that the employee has deserted, thus repudiating the contract of employment by abandoning the employment. The employer will then accept that repudiation, thus terminating the contract.
The question is â€“ what does the employer do about such a situation ?
There are avenues open to the employer â€“ but all will incur legal costs. And there is no guarantee that the Court will make an award as to costs in favour of the employer.
The employer can sue for specific performance. This means that the employer can sue the employee to perform the according to the terms stated and agreed to between the parties to the contract. It follows that this will mean that the Court compels the employee to return to work and work out the contractual notice period.
There are all sorts of pitfalls and conditions regarding a lawsuit for specific performance, and it is not recommended in the context under discussion.
The employer has a further option, namely to sue for damages. The employer (called the plaintiff in a civil action) must prove firstly that the breach of contract by the employee took place. He must establish that there was a breach.
He must then prove that he has suffered damages, and he must quantify those damages and prove that the damages suffered was as a direct result of the breach. The employer should also take reasonable steps to mitigate (lessen the adverse impact of ) the damages if possible.