BREACH OF CONTRACT

Also known as Wrongful Dismissal, this occurs where the terms of an employment contract are breached by one of the parties. For a Breach of Contract claim it is not requisite for a dismissal to have occurred and can simply be e.g. an employee breaching a restrictive covenant in an employment contract. Claims can be brought in either the Employment Tribunal or the Civil Courts. The tribunals have limited jurisdiction in that the maximum amount awardable as damages for breach of contract is £25,000.00. Bearing in mind that many breach of contract claims will involve issues such as non-payment of notice monies, benefits, bonuses, commissions etc., this may be insufficient to cover the entire claim. Consequently, unless the breach of contract claim is being brought in conjunction with an unfair dismissal claim, most applications will be in the Civil Courts where there are no limits on the sums awardable and costs are recoverable.

Cases of Wrongful Dismissal do require a dismissal to have taken place. Often these claims occur where an employer has dismissed an employee without giving proper notice or without adequate compensation in lieu. An important consideration when bringing a claim of this nature is the fact that an employee is under a duty to mitigate loss. Hence if the contract provides for say 6 months notice but none is given by the employer, this does not mean that the entire 6 months sum is payable. If the employee obtains new employment in a shorter period of time, the damages will be limited to the actual loss incurred.