Contract of Employment Essay Example

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Contract of Employment

Contract of Employment

There has always been the master-servant relationship which is now the employer-employee relationship. The master- servant relationship/employer employee relationship is slowly wiping out the ‘independent contract’. However, it is imperative to note that these two relationships are different in that the master had full control and servants regarded as being inferior in that relationship1. However, as the law evolved, employees gained more power so that they would be in a position to bargain more on the terms they deemed suitable to them in that employment relationship (Seweryński 2003). This is what contract of employment contract is all about. This has resulted in eruption of many laws to ensure compliance with recommendations of the International Labor Organization of 1998,a Declaration of fundamental principles and rights at work that was adopted, so as to safeguard and promote respect for basic workers’ rights.

In regard to these statements, it is imperative to distinguish between an independent contract and an employment contract and their aspects. In order to distinguish them, 3 features of the agreement ought to be examined. These are the relationship between the parties, control of behavior of either parties and financial control (A Stewart 2013). Independent contract basically involved a person providing services or goods to another only when required to do so, unlike in an employment contract where the employee works regularly for the employer. In an independent contract, the contractor could work for several clients therefore had the control in terms of the work schedule, how the job was to be performed and the number of hours he was supposed to work. This is unlike the employment contract where an employer controls the work schedule, how the job is to be performed and the hours the employee works. Of equal importance to note is that the contractor usually used his own equipment unlike an employee who uses the employer’s equipment ( 2005)ODonnell.

Contract of employment came about to take over much of what independent contract occupied. Then as time goes by, industrialized democracies introduce laws that seek to protect employees in different manners (MacDonell 2004) First and foremost, it is critical to note that workers’ rights have been recognized even on the international stage with the introduction of the International Labor Organization of 1998. The International Labor Organization adopted a Declaration of fundamental principles and rights at work, so as to ensure that the basic workers’ rights are safeguarded, promoted and respected. So in the end one note that what these laws are trying to do is empower the worker and in the long ran he/she tends to acquire the status of an independent contractor (Stewart 2013).

Most industrialized democracies tend to adopt common law and change just a few things here and there. However, caution is called for as one eminent English judge, Lord Denning observed in Nyali Ltd v Attorney General [1956] 1 QB 16 regarding the applicability of the English common law in other continents/states.2

More recently, authors Care and Haller have reiterated that Lord Denning’s dictum highlights the inherent difficulty in applying the common law, developed over centuries in England, to foreign countries where very different circumstances prevail. Accordingly, the need to take the circumstances into account was recognized in the provisions applying the common law to new settings. One should apply only insofar as the circumstances of the country permit. Also implicit in Lord Denning’s dictum is the notion that developing countries that import or transplant model laws from abroad to their own local environments should consider not only the ‘wisdom’ of foreign technical experts but also the local insights and peculiarities articulated by some local experts.

In the early 19th Century, the contractor was the larger controller of the agreement. The contractor could leave a contract of employment. However, as the independent contract was being replaced by an employer-employee agreement, the employer gained more power. For example Work Choices regulated for government intervention and at the same time government withdrawal. It relinquished considerable freedom to employers in regard to how they could bargain with employees. Governments regulated even the trade unions, at times for political reasons. A good example is the Workplace Relations Act in 1996 Australia that still bears an overregulated system. This is where the “Abstentionist” and the “Interventionist” notions came in3. However, on the global stage this has been a subject of scrutiny leading to formation of worker-friendly laws. Right now workers have increased their power to negotiate terms and conditions that favor them. Similarly, trade unions that they continue to form increase their collective bargaining power. In the end they may end up being stronger than an independent contractor while still in a contract of employment. Even at this moment when the employees may be enjoying several rights at their workplace, it is crystal clear that these employment contracts are at times subject of control from a third party other than the employee and the employer (Mark 2003). Governments are intervening, whereby at times they may argue that they are trying to protect the employee from some callous employers. However, unanswered questions still remain on who is to fight and protect the rights of the employer. This calls for urgent redrafting of the legislative framework that suits all the parties in an employment contract (Merit 1982).


Stewart,A, Stewart’s Guide to Employment, (2013)

Merit “The Historical Role of Law in the Regulation of Employment: Abstentionist or Interventionist?” (1982)

John MacDonell, Classification of Forms and Contracts of Labour (Journal of the Society of Comparative Legislation, Vol. 5, No. 2, 2004).

Mark Freedland, The Personal Employment Contract (Oxford University Press, 2003).

Seweryński Michał, Collective Agreements and Individual Contracts of Employment, (Kluwer Law International 2003).

ODonnell Aidan, The new employment contract: using employment contracts effectively, (Cornell University 2005).

, Alcoa of AustraliaEmployment Contract, (Western Aluminium 2008)

Nyali Ltd v Attorney General [1956] 1 QB 16

Adair v. United States, 209 U.S. 161, 175 (1908)


Workplace Relations Act in 1996

Adair v. United States 209 U.S. 161, 175 (1908)

Nyali Ltd v Attorney General [1956] 1 QB 16

Workplace Relations Act 1996

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