The Common Law Obligations of the Employee under the Contract of Employment

• Author: Geoffrey England
• Pages: 37-65

THE

COMMON

LAW

OBLIGATIONS

OF THE

EMPLOYEE

UNDER

THE

CONTRACT

OF

EMPLOYMENT

An

employee owes

his or her

employer obligations under

both

the

express

and the

implied

terms

of the

employment

contract.l

Regarding

the

employee's express obligations,

we saw in the

previous chapter that

employment contracts generally

do not

contain

a

detailed

and

compre-

hensive list

of the

employee's duties, except perhaps

for

higher echelon

executives,

sports

stars,

and

entertainers. Usually,

the

contract

of

employment will state little about

the

employee's obligations beyond

providing

a

brief

job

description

and

summarizing

the

basic pay,

the

basic

hours

of

work,

and

annual vacations.

The

most common excep-

tion

is a

restrictive covenant that prevents

the

employee

from

compet-

ing

with

his or her

employer within

a

defined

area

and for a

defined

period

of

time

after

the

employment relationship ends.

We

examine

the law on

restrictive covenants

in

this chapter.

The

explanation

for the

relative dearth

of

express terms

in

employment contracts

is

that

the

parties cannot, when they

are

negotiating their contract,

foresee

all

possible

contingencies that might occur over

the

lifetime

of

their rela-

tionship

and

deal with them

in

advance. Consequently,

the

courts have

had to

fill

the gap by

implying terms into

the

employment contract,

and the

scope

of the

employee's obligations

to his or her

employer

at

common

law

depends almost exclusively

on

these implied terms.

1 For

further

detailed elaboration

on

this topic

see G.

England,

I.M.

Christie,

& M.

Christie,

Employment

Law in

Canada,

3d

ed., looseleaf (Markham, Ont.:

Butterworths,

1998)

c. 11

(II-III).

37

[wEBMMMI^E]

38

INDIVIDUAL

EMPLOYMENT

LAW

According

to the

general

principles

of

contract

law,

terms must

be

implied into

a

contract

in

order

to

give

effect

to the

unstated

factual

intentions

of the

parties, otherwise "freedom

of

contract" would

be

jeopardized.

In

reality, courts

often

imply terms into contracts

in

order

to

reflect

the

judges' perceptions

of

what

the

parties' respective rights

and

obligations

ought

to be as a

matter

of

public policy.

This

has

clearly

happened

in the

case

of the

employee's implied obligations under

the

employment contract.

The

courts have, over

the

years, developed

a

standardized body

of

particular obligations that

are

implied into

all

employment contracts.

The

cornerstone

of

these particular obligations,

however,

is an

overriding residual duty

of the

employee

to

conduct

himself

or

herself

in the

best interests

of the

employer, usually referred

to as the

"duty

of

fidelity."2

This duty

is

critically important

for

employers. Because

the

employer cannot predict

and set

specific rules

in

advance

for the

myriad circumstances that

can

arise during

the

course

of a

long-term employment relationship,

it is

essential that

the

employer have

the

flexibility

to

command obedience

from

its

employ-

ees as new

circumstances

arise.3

Plainly,

it

would

be

grossly

inefficient

if

the

employer

had to

renegotiate

the

express terms

of the

employment

contract every time

an

unexpected occurrence

arose!

The

implied duty

of

fidelity, therefore,

delineates

the

scope

of

"managerial prerogative"

at

common

law.

Most

of the

cases

on the

implied obligations

of the

employee arise

in the

context

of

litigation over wrongful dismissal, since

the

employer's usual reaction

to a

perceived breach

of

duty

is to

fire

the

worker summarily without notice

or

wages

in

lieu. Consequently,

the

scope

of the

employee's implied obligations becomes inextricably inter-

woven

with

the

issue

of

whether

the

employer

had

"just cause"

for

summary dismissal.

We

shall

see in our

examination

of

just cause

how

the

rigour

of the

employee's implied duty

of

fidelity

has

been tempered

to

reflect

modern notions

of

proportionality

and

fairness.4

However,

an

employer

may

sometimes

sue an

employee

for

damages

to

recoup

losses

it has

suffered

as a

result

of the

employee's breach

of his or her

The

historical antecedents

of the

employee's duty

of fidelity can be

traced

to the

pre-Industrial

Revolution

law of

master

and

servant

in

England.

See,

for

example,

A.

Fox,

Beyond

Contract:

Work,

Power

and

Trust

Relations

(London:

Faber,

1974)

at

154-59,

178-81, 184-88.

The

centrality

of

this point cannot

be

overemphasized.

See,

for

example,].

Godard,

"The

Progressive

HRM

Paradigm:

A

Theoretical

and

Empirical

Re-Examination"

(1991)

46

Rel.

Indust.

378 at

383.

See

chapter

9 of

this book.

2

3

4