The contract will have real implications that affect the employer/employee relationship.
The contract, in conjunction with employment legislation, will affect how the employment relationship operates in practice. It will contain many of the parties’ rights and obligations in relation to one another. Some of them express, some implied by law.
Breach of contract may give rise to claims and remedies. The law of constructive dismissal, for example, is based on the principles of breach of contract.
The contract may contain a detailed job description which will have a direct bearing on what an employer can require an employee to do during employment; what the employee may refuse to and will be important in redundancy cases where an employee’s job is said to be at risk.
The contract will set out important matters like rates of pay, hours of work, holiday entitlement, benefits that accrue to the employee during employment such as a pension. It may incorporate disciplinary and grievance procedures. It may include express duties of fidelity, provisions about confidential information and intellectual property.
The contract may set a limited-term for the duration of employment. It will contain information about notice that the parties are required to give to each other to bring the employment to an end.
The contract may dictate how and when work is to be done by the employee including, say, a provision for shift work. The contact might say that the employee could be required to work in a different geographical location – perhaps some way distant from the original place of work.
Some contracts include the right of an employer to insist that the employee undergoes a medical examination. A right to search employees is sometimes contained within the contract.
Some contracts restrict an employee to working only for the employer during employment. The employer may reserve a right to put an employee on garden leave. The contract may contain restrictive covenants that attempt to protect the employer from unfair competition from an employee when the relationship ends.