Implied Duties of Employees Flashcards
Employees have implied duties to their employer. name them:
- Obedience
- Personal Service
- Reasonable Care
- Good faith/fidelity
Employees duty to be obedient
Generally, an employee must obey all reasonable orders that are within the scope of their contract, or they may be in breach of contract.
Pepper v Webb (1969)
A gardener was asked by his employer’s wife to put some plants in.
He said he was leaving at 12pm, and you can do what you like about them.
He was asked again, and refused.
He was instantly dismissed and he sued for wrongful dismissal, arguing his employer had no grounds to terminate the contract without notice.
The court held that he had repudiated his contract by refusing to obey a reasonable order.
Employees duty to provide personal service
An employee must be ready and able to work, and must not delegate their duties to anyone else.
Taking part in illegal industrial action (e.g. an unofficial strike) will breach this duty.
Employees duty to take reasonable care
if an employee acts negligently, the employer may have the right to dismiss the employee and also claim an indemnity if the employer is found liable in damages.
Duty of Good faith/fidelity
The duty to act in good faith is very broad and covers a wide variety of situations.
It includes which duties?
- Not to disrupt the employer’s business interests
- Not to compete with the employer
- Not to use or disclose any confidential information
- To surrender inventions and patents
- Disclose information concerning the employment
- Account for secret profits
Duty not to disrupt the employer’s business interests
There is a general duty on an employee not to disrupt their employer’s business.
One form of disruption is industrial action i.e. strikes.
Taking part in industrial action is a breach of contract, and the employer can withhold pay.
Duty not to compete
An employer cannot generally prevent an employee form having another job.
However, in some circumstances, employees can be held in breach of contract if they do an identical job for another firm where they might divulge trade secrets
(see Hivac Ltd v Park Royal Scientific Instruments Ltd (1946).
Duty not to use confidential information - DURING employment
Under the implied duty of good faith, the employer may be protected form an employee using confidential information.
Employer’s could use a restrictive covenant in their contract which states the employee will not use trade secrets or customer connections after leaving the employer.
Is the “secret” the employers property or common knowledge?
United Sterling Corporation v Mannion (1974)
If the “secret” is actually common knowledge, or can be said to have become the employee’s property, there will be no breach of confidence.
In United Sterling Corporation v Mannion (1974), an employee in charge of a process involving new techniques which had a resale value was offered employment by another company which intended to install the same process.
An injunction was refused because it was held that the information was merely part of the employee’s general experience. Such skill and experience is not confidential to the employer.
Duty not to use confidential information - AFTER employment
Faccenda Chicken Ltd v Fowler (1986)
A former employee set up in business in competition with the company, and recruited eight of his former workmates.
The ex-employer claimed they were using confidential sales information, and were thus in breach of their fidelity duty.
The Court of Appeal held that the information they were using was not so confidential hat there was an implied term preventing them from using it after they left employment.
An implied term not to disclose information after employment has ended only includes trade secrets and information of a highly confidential nature. What is confidential is a question of degree.
Duty to surrender inventions and patents
As far as common law is concerned, unless there is an express agreement to the contrary, all inventions belong to the employer.
Under the Patents Act 1977, it states the employee is the owner of any invention, unless the invention was made while the employee was acting in the course of their employment.
This applies if it is reasonable to expect an invention to result from the employee’s duties, or of the employee owes a special duty to the employer.
Duty of disclosure of information concerning the employment
An employee has a POSITIVE obligation to disclose any information which may be of benefit to the employer, and
Can be made to disclose information which may adversely affect the employer if it is felt it is in the public interest.
Duty of disclosure of information concerning the employment
What if disclosure of the information is detrimental to the employee?
There is no implied duty to disclose information which might be detrimental to the employee themselves
Bell v Lever Bros (1932)
unless concealment amounts to fraud or is associated with incompetence.
There is also no implied duty on an employee to “inform” on fellow employees.
The duty to account
The employee must account for all money and property received during their employment.
In Boston Deep Sea Fishing Company v Ansell (1888), the defendant was the managing director of the claimant and owned shares in it.
He also had shares in another company that supplied the claimant company, and received a bonus on those shares in respect of all sales.
These amounted to a secret profit which was a breach of his duty to account, and the company was entitled to dismiss him.
