Current State of Employment Law - Essay Example

These laws have been developed to promote a degree of legal certainty and fairness with the ultimate goal of avoiding conflicts by balancing enterprise flexibility and employee protection. However, as is quite often the case with any area of law, legal certainty is virtually impossible as the law can rarely contemplate or predict every event or set of circumstances that can arise. This is particularly so in labour industries where economies and policies are constantly changing to accommodate the realities of the times.

Historically, the contract of employment makes provision for the basic employee/employer relationship. However, the terms and conditions of that contract have always been interpreted by reference to a statute, hence the significance of the term “status”. The fact is, although the employment status may be agreed to and reflected in an employment contract, the matter does not end there. This is entirely important because employee status will often correspond with the degree of employee protection and rights. The law, therefore, intervenes to ensure fairness in the construction of the employment contract to provide a greater degree of legal certainty and fairness in the determination of the employee’s status.

The implications are far-reaching in terms of creating a balance between fairness and legal certainty. To begin with, the inequality of bargaining power in the employment relationship is well recognized and accepted. As Edwards explains, it was necessary to depart from the concept that employees and employers were at liberty to negotiate and finally reach an agreement as to what will form the essential terms/conditions of the employment contract resulting from the parties’ own different positions in relation to one another.  Specifically, party autonomy is undermined because it necessarily levels the playing field between the relative power imbalances between the employee and the employer.

In this regard, the statute intervenes to define the term employee and even then, provides a degree of legal certainty by leaving the definition vague enough to ensure that adjudicators can flexibly determine whether or not employee status can be inferred. To this end Section 230(1) of the Employment Rights Act 1996, provides the term “employee” refers to a person who either has or “works under” an employment contract.

So far, employee status is not a matter to be determined by the parties, but by statute. Thus far, this statutory provision provides for the necessary legal certainty in providing that any individual who enters into or works under an employment contract is an employee. However, it is not altogether legally certain what working under an employment contract means.  If given its literal meaning, an employee who specifically accepts the right to delegate his/her employment to another would be an employee under a contract of employment.  However, Archer-Hoblin Contractors Limited v MacGettigan informs otherwise. It was held in Archer that if there was such a clause in a contract, the employee would essentially be self-employed and therefore unable to claim employee status under Section 230(1) of the Employment Rights Act 1996.

The lack of legal certainty here is entirely necessary because the situations under which an individual may be employed can vary from one case to another.  As a result, it is not possible to devise a simple and single rule of law that can apply to all situations. Therefore, in the interest of fairness to both sides, Section 230(1) has deliberately left enough room for adjudicators to determine what situations are suited to employee status and what situations are not on a case-by-case basis. An all-encompassing rule, which might provide legal certainty to perfection, would at the same time, in many cases result in acute unfairness to the employer.