Free Paper Example on Common Law

Introduction

The Commonwealth Bank argued that it was not bound to follow its policies. The Human Resource Manual indicated that “The manual is not in any way incorporated as part of any industrial award or agreement entered into by the Bank, nor does it form any part of an employee’s contract of employment” (Sundra-Karean, 2016). As a result, the High Court has long insisted that there is a difference between the contract of employment and the employment relationship. The court described the development of the implied term as being “consistent with the contemporary view of the employment relationship as involving elements of common interest and partnership, rather than of conflict and subordination”. Such arguments prove that common law has limitations when it comes to promoting fair employment relationships.

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Implied Duties

The discussion above has already proved that courts have the power to impose terms on the parties where the contract is silent. In common law, the courts will imply terms into employment contracts. For example, one of the employee's implied duties is to act in good faith, while one of the employer’s implied duties is to pay wages. However, there are more implied duties to the employee than the employer in employment contracts. Employee's implied duties are discussed in this paper to prove the argument that there are more implied duties to a worker than the employer in contracts.

The Duty of Fidelity

This implied term requires the employee to faithfully serve the employer and not act against the employer's interests. The term only applies during employment and does not carry on after termination of the employment contract. The duty consists of several potential aspects, including:

Duty Not to Compete

An employee may not work in competition with their employer. The duty applies during working hours and when in a contract. However, the term does not extend after the contract of employment is terminated. Therefore, express contractual provision is required to restrict competition on termination of employment. The term prevents a worker from working for a competing business or set up a business in competition with his employer.

Duty to Behave Honestly

The duty of fidelity requires an employee to be honest in his dealings with his employer. However, there are exceptions to the rule that an employee must answer his employer’s questions honestly. Dishonesty justifies summary dismissal, and even the employer's reasonable belief in deceit may make a contract termination fair.

Duty Not to Make a Secret Profit

An employee must not make a secrete profit by using his employer's assets, including its information and business opportunities. Generally, the employee must ensure that any chance to secure a profit must be directed to his employer rather than kept for his benefit.

Duty to Disclose Information

All information made in the course of employment must be passed to the employer. Information may include new inventions, and anything employees discover themselves. Generally, an employee is not under a duty to disclose his misconduct to his employer; however, employees in more senior positions have to tell their misdeeds. An employee is also not obliged to disclose a colleague’s misconduct; however, some specific situations may require one to perform such a duty.

Duty Not to Trade Secrets and Confidential Information

The duty of fidelity prevents an employee from disclosing any trade secrets or confidential information that comes to his knowledge during his employment to third parties. Concerning trade secrets, the duty of confidentiality lasts up to the end of employment.

Duty to Obey Reasonable and Lawful Direction

Under common law, employees have an implicit duty of obedience and cooperation in their contract of employment. Employees, therefore, have a responsibility to carry out any lawful and reasonable direction from their employer. A legal direction is when the employer does not need the employee to contravene a State, Commonwealth, or Territory law. In some cases, employers have dismissed employees for failing to follow reasonable work instruction. For example, in Powell v Hunter Water Corporation, the employer dismissed an employee for not following his defective car's direction to be serviced immediately. However, there are instructions that an employee is not expected to follow. A worker cannot follow his employer's directive if it is unlawful, it is unreasonable, and it is outside the employee's ability, skillset, or qualification. If an employee refuses to follow directives under such situations, it does not constitute serious misconduct at work; therefore, it must not result in summary dismissal.

Conclusion

Employers also have a set of implied duties which is required of them to adhere to. However, these terms are less demanding as compared to the duties employees face. An employer must care for his employees’ safety and general welfare. Employers also must maintain mutual trust and confidence. In contracts, employees implied duties are more complicated as compared to the employer's terms. It is clear that Australian common law, especially in contract laws, plays a limited role in employment relationships. Employees face a significant challenge in terms of protection against unlawful contract termination.

References

Bomball, P. (2014). Necessity, coherence and mutual trust and confidence: Commonwealth Bank of Australia v Barker.

Nielsen, T. (2014). Employment law:'Mutual trust and confidence'negated: Commonwealth Bank of Australia v Barker [2014] HCA 32. Proctor, The, 34(10), 28.

Sundra-Karean, V. (2016). The erosion of the implied term of mutual trust and confidence in Australian employment law.