Employment as a relational contract and the impact on remedies for breach

Abstract

The notion of employment as a relational contract has received much academic attention and is gradually being recognised by common law courts in judicial decision-making. This article focuses on a primary question: what impact, if any, could that relational classification have on the remedies available where an employment contract is breached? Given that this question has not yet been considered judicially, and only mentioned in passing in academic writing, this article seeks to probe the question by traversing existing judicial and academic understandings of employment contracts as relational in nature. It then considers the potential impact that the relational classification may have on the remedies available to employees whose employment contracts have been wrongfully terminated by their employer. Three options are put forward in respect of the potential impact on the remedy available for breach, each of which is underpinned by a combined theoretical and doctrinal analysis. First, it is suggested that awards for specific performance may become more prevalent. Secondly, there may be a place for a special category of relational damages. Finally, it is acknowledged that the relational classification may end up having no impact on the available remedy at all.

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