Nov 20, 2014


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A contract of employment is a contract between an employer and employee in which the terms and conditions of employment are stated. The term “employee” denotes anyone who is employed under a contract of employment for remuneration and an employer is such person who employs an employee. 

An employment contract is an agreement which carries with it an obligation to pay wages in return for service and a corresponding right of control on the part of the employer. Before an employer/employee can make claims under the contract of employment, such party must prove that the existence of a contractual relationship. 

A contract of employment can be oral, written, or partly oral and written; it may even be inferred or implied from the conduct of the parties, though most contracts of employment are either oral or written.

When an employee begins work, the labour act states that such employee must be given his contract of employment within 3 months and it should state:
  • The name of the employer
  • Name, address of the employee and the place and date of his engagement.
  • The nature of the employment
  • If for a fixed term, the date the contract expires
  • Appropriate medium and method to terminate the contract
  • Rates of wages and method of calculation/payment
  • Any special conditions of the contract; and
  • Any terms or conditions relating to: hours of work; holidays and holiday pay; and Incapacity for work due to sickness or injury, including any provisions for sick pay.
It should be noted that contract sof employment are not binding on the family or dependants of the worker unless it contains a provision to that effect. Also persons under the age of 16 re not capable of entering contracts of employment except such contracts are for apprenticeship. Also, no contract of employment can bar a worker from belonging to a trade union. 

A contract of employment can be terminated by:
  • Expiry of the period for which it was formed
  • Death of the worker
  • By notice
Where it’s a contract of 3 months or less, one day notice should be given. One week notice if more than 3 months but less than 2 years; two weeks notice where the contract has lasted for more than 2 years but less than 5 years and one month, where the contract had continued for 5 years or more. Usually most contracts of employment provide either one month or 3 months notice or one month or 3 months’ salary in lieu of notice.

Adedunmade Onibokun, Esq.


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