Monday 25 February 2008

Enforceability of Employment Contracts

The EAT has held, in Steelcraft v Ellis, that a clause asserting that a 'contract' was not intended to create any legally enforceable rights is void under s203 of the Employment Rights Act 1996 if the only purpose of that clause is to alter what would otherwise be the legal effect of contractual arrangements.

In other words, an employer cannot avoid (what would otherwise be) contractual - and consequent statutory - obligations by inserting a clause in a contract providing that it has no legal effect. (see paras. 66-69 of the judgment).

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