Employ­ment law myth No. 3: ​“Oral con­tract? It’s not worth the paper it’s writ­ten on!”

There is no gen­er­al require­ment for employ­ees to be giv­en a writ­ten con­tract. That is not to say it is not strong­ly advis­able to have one in place, not least because there will be less room to argue about the terms of the employ­ment in the future.

It is impor­tant to note that oral con­tracts – such as a ver­bal agree­ment as to how much an employ­ee will be paid, or their duties whilst at work – can be bind­ing at law. So too can con­trac­tu­al terms that are ​“implied” through a course of con­duct. Issues fre­quent­ly arise where an employ­ee is con­sis­tent­ly giv­en a ben­e­fit over a peri­od of time and then the employ­er wish­es to remove or alter the terms of the ben­e­fit at a lat­er date (for exam­ple, to a bonus or to a com­pa­ny car). With­out a writ­ten con­tract spec­i­fy­ing the terms under which the employ­er is enti­tled to do so, the poten­tial for a dis­pute will always be there. 

It should also be not­ed that gen­er­al­ly Awards require employ­ers to put in writ­ing, par­tic­u­lar details about the terms under which employ­ees are engaged, for exam­ple, what their Award clas­si­fi­ca­tion is and in the case of part time employ­ees, the hours they are to be engaged for.

For any advice on rights and oblig­a­tions con­cern­ing employ­ment con­tracts, please con­tact: sro@​swaab.​com.​au or rbo@​swaab.​com.​au