Glossary > Employment Law > Termination And Dismissal > Constructive Dismissal

Implied Contract

An implied contract in employment law refers to an agreement between an employer and an employee that is not explicitly outlined in writing but is understood based on the actions, policies, or communications of both parties.

Example #1

An implied contract may exist when an employer consistently promises job security in exchange for continued good performance without specifying this arrangement in a written contract.

Example #2

Another example of an implied contract could be when an employer states during the hiring process that employees will only be terminated for cause, creating an expectation of job security.

Misuse

Misuse of implied contracts can occur when employers lead employees to believe they have job security or certain rights through consistent practices but later terminate them without cause. This can be detrimental to employees who rely on these implied promises and may face unexpected job loss without legal recourse.

Benefits

The benefit of recognizing implied contracts is that it provides a level of protection to employees from arbitrary or unjust terminations. By acknowledging the existence of implied agreements, employees can have more confidence in their job security and rights within the workplace.

Conclusion

Understanding implied contracts is crucial in protecting employees from unfair treatment or wrongful termination. It highlights the importance of clear communication and upholding implied promises to ensure fairness and transparency in the employment relationship.

Last Modified: 4/30/2024