Doctrine of Frustration
A contract of employment can be terminated (1) on grounds of performance or expiry, (2) by agreement, (3) due to an evident fundamental breach, as well as (4) on basis of frustration.
An employment contract may be said to have been frustrated and brought to an end when an unforeseen supervening event occurs that renders the performance of the contractual obligations practically impossible or illegal. Destruction of subject matter [Taylor v Caldwell (1863)], government interference [Shenyin Wangou-APS Management Pte Ltd v Another v Commerzbank (South-East Asia) Ltd (2001)], non-occurrence of event [Krell v Henry (1903)] and personal incapacity [Poussard v Spiers & Pond …show more content…
Frustration due to employee’s illness only applies when the illness is of long-term nature causing prolonged disability or inconveniences. Temporary illness, such as minor ailments that causes an employee to be away for periods of short duration, does not constitute to frustration as it merely affects the performance, not rendering the performance impossible.
Effects of Frustration
When frustration is established, under the common law, the contract will be terminated automatically by operation of law, excusing the non-performance of contractual obligations. The doctrine of frustration is rarely successfully argued as the court viewed that a contract functions to allocate risks and if unfortunate event does occur, then it is a risk that the contract ought to have contemplated. However, the recent case of Warner v Armfield Retail & Leisure Ltd (2012) had showed that the doctrine of frustration still applies. WARNER V ARMFIELD RETAIL & LEISURE LTD  UKEAT 0376_12_0810 …show more content…
Having an adjustment that re-allocates Warner to an administrative role would completely render the contract fundamentally different in character from the original intention of both parties, which would be unreasonable and unjustifiable as the employer initially employed Warner because of his competency and compatibility as a Site Manager, not administrative personnel. An adjustment shall be construed as reasonable only when it does not radically differ from the initial contractual agreement. For instance, an employee with visual impairment is frequently absent from work because of eyestrain and to reasonably accommodate to this employee, the employer could make necessary arrangements to have all her work documents enlarged. By doing so, the employer made the necessary adjustments and the employee is still able to perform duty in which she was originally employed