The Labour Court recently ruled that employers have a duty to inform prospective employees that the job that is offered to them is temporary and could be terminated at the end of a brief period, irrespective of their performance.
The case under discussion concerned an employer in the tourist business, which recruited an employee during the tourist season. At the end of the tourist season, the employer terminated the employment contract due to redundancy.(1)
The court awarded the employee damages due to a breach of the duty to notify the employee before engagement that the job being offered was temporary.
The court based its decision on the following reasoning: in cases in which an employer is aware of facts that could influence the candidate's decision to accept employment at the terms being offered, the employer must divulge these facts to the candidate.
The court ruled that, in the absence of other information, a candidate is entitled to assume that if he or she carries out the job satisfactorily, in the absence of unforeseen events, he or she can remain in employment indefinitely. Accordingly, an employer that knows in advance that the employment offered is of limited duration, but does not disclose this to the candidate, breaches the duty of good faith provided for by Section 12 of the Contracts Law 1973.
The severity of the breach is affected by the extent to which the employer knew or should have known of the circumstances in which the breach could intensify the damage caused to the employee. Examples cited by the court included a candidate who resigns from another job and an employee who waives IP rights on the basis of an expectation of indefinite future employment with the new employer.
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