What happens if an employment contract is breached?

On Behalf of | Sep 28, 2020 | Employment Contracts

Contracts generally govern the relationships between parties and serve as an agreement that outlines the rights and responsibilities the parties have to one another. This is also true of an employment contract. If an employment contract is breached, both the employer and the employee may have legal remedies available tot hem depending on who breached the contract. Potential remedies include:

Remedies for the employee

The employee may be able to recover compensatory damages for what they would have received under the employment contract if the employer breaches the contract. The employee may be able to recover compensation equal to what they would have received had the employer performed the contract. The employer can be liable for the full price of the contract to put the employee in the position they would have been in had the contract not been breached.

Remedies for the employer

Employers may be able to recover compensatory damages to compensate them for their damages when an employee has breached an employment contract. Typically, the damages will be calculated based on what it costs the employer to replace the employee above what they were already paying them in the contract. If the employee breaches the contract because they become ill, for instance, they may not be held liable for damages that would potentially unjustly enrich the employer.

Employment laws can protect both employers and employees. In any situation when a contract has been breached, the parties should understand the potential remedies available, including damages, enforcing the contract or rescinding the contract altogether as examples.