{"id":1822,"date":"2022-01-17T05:56:23","date_gmt":"2022-01-17T05:56:23","guid":{"rendered":"https:\/\/uk.legalvision.com.au\/?p=1822"},"modified":"2024-05-22T07:16:08","modified_gmt":"2024-05-22T06:16:08","slug":"good-faith-obligation","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/employment\/good-faith-obligation\/","title":{"rendered":"What Does the Good Faith Obligation Mean in England and Wales?"},"content":{"rendered":"

Primarily, an employment contract sets out the terms and obligations of the relationship between you and your employees. This may be detailed in express terms and implied terms<\/a>. Express terms are those you clearly include within the contract, such as work times or pay rate. Implied terms, however, are less obvious and are not clearly written into the employment contract. Therefore, as an employer, it is important that you are aware of both your express obligations and your implied ones. Indeed, implied terms will be less easy to identify. One such implied term is the obligation of good faith.\u00a0<\/span><\/p>\n

This article will explain the good faith obligation or the duty to act in trust and confidence.<\/span><\/p>\n

Good Faith Obligation in Contracts<\/span><\/h2>\n

Generally, the good faith obligation in a contract means that parties to the contract must make and perform their duties within it in good faith<\/a>. Importantly, there is no general duty of good faith in English contract law<\/a>. Therefore, where you intend to make this obligation relevant in a contract, you must clearly state it.<\/span><\/p>\n

Likewise, there is also no firm legal definition of a good faith obligation. However, generally speaking, good faith means acting honestly or with a legal purpose. Ultimately, there is the expectation that parties to a contract will act fairly, transparently and reasonably.<\/span><\/p>\n

Good Faith Obligation Between Employers and Employees<\/span><\/h2>\n

A good faith obligation is an implied duty in employment contracts. It is commonly known as the implied duty of trust and confidence. As an employer, you have obligations to act in accordance with this duty of trust and confidence. Indeed, this obligation also extends to your employees. However, usually, it will be your employees who raise an alleged breach of this duty rather than you as an employer doing so.<\/span><\/p>\n

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You should note that an employer may act in good faith but still be seen to breach the duty of trust and confidence.<\/span><\/p>\n<\/div>\n

English courts have found a duty of good faith to exist in employment relations regarding the provisions of pensions. Likewise, the court found that the good faith duty applies in two ways:<\/span><\/p>\n

1. A contractual duty owed by an employer to their employees.\u00a0<\/strong><\/p>\n

This relates to how you treat your employees and carry out your business. As an employer, this duty requires you to act responsibly and with good faith, being mindful of fairness and trust.<\/span><\/p>\n

2. An imperial duty.<\/strong><\/p>\n

This concerns you acting reasonably rather than irrationally with regards to your employees.<\/span><\/p>\n\n\n Continue reading this article below the form\n <\/i>\n<\/a>\n

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