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Termination Of Contract In Business Law

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In order to discuss the issues involving employment contracts it is first of the utmost importance to be able to identify what constitutes as a contract of employment. Both the Employment Rights Act, 2012 of Barbados and the text Business Law, Fifth Edition (this definition is taken from s 230 of the Employment Rights Act (ERA) 1996) have stated that a contract of employment can be seen as a contract of service or apprenticeship, whether express or implied, and if expressed, whether oral or in writing. Furthermore, the employee must demonstrate continuity of employment to benefit from employment rights legislation. A contract of employment must not be mistaken for a contract for services since employment rights are only taken into consideration …show more content…
To assist in the differentiation between the two types of contracts the courts have established a number of criteria or tests through case law to be applied in order to reach a judgement. These tests are the Control Test, the Integration Test, the Multiple Test and the Mutuality of Obligation Test. The Multiple Test has proven to be the most adaptable as it provides for a wider definition of the concepts used to determine what type of contract exists. Under Chapter 14, Section 14.2.3 of Business Law, Fifth Edition; it states that the Multiple Test only requires the evaluation of the factors which are inconsistent with the existence of a contract of …show more content…
The contract of employment can be terminated by death, agreement, performance or frustration. Termination affects many areas, there will always be the legal aspect, was the termination fair? It will also affect the government in terms of unemployment statistics, payment of unemployment benefits and GDP. Termination can be in the form of summary dismissal, wrongful dismissal, unfair and fair dismissal and redundancy. It is imperative that both employer and employee are aware of the legislation of their jurisdiction that administers the law as it pertains to termination of contracts. For example, most legislation requires the initiating party to give notice for a certain period before the termination goes into effect. Only summary dismissal dos not require notice to be given. This type of dismissal is usually given for a very serious breach of duty and the contract is terminated with immediate effect. However, before the employer decides to select this method he/she should be able to prove that this type dismissal was

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