Welcome in the series notes of “Corporate and Business law |ACCA F4 Notes”. In this article we will learn about “Employment law“.

Test to determine the relation of an employment

How to know whether a person is an employee or self-Employed?

By Control Test

We can determine by the “control test” where an employer suggests or tell the role and duties of an employee. We can find an employee by this test.

By Integration Test

An “Integration test” If the person work within or internally in the organization that is employee because he works integral if not work in organization or non integral then he is a self-Employed.

By Economic reality or Multi Test

If you provide all necessary things to do work then it is “Employee” and if you do not provide any economic facility then it refer as “Self-Employed“. If any loss is occurred “Employee” is unaffected but “Self-Employed” will be effected from loss.

Why to differentiate between Employees and Self-Employed?

The Contract of Employment

This is the contract between employee and employer and it tell the rules, duties and boundaries of an employee within the work or in organization.

Express Term: the terms between an employee and employer can be in written or oral form.

Note: According to “Employment Right Act 1996” there must be a written statement between employee and employer and after 2 months of period there must be signed on the contract.

Principal Statement

It usually relates to businesses, the content on the principal statement is following:

  1. Business name
  2. Employee name. job title, job description and joining date
  3. Previous job information
  4. Salary and date of payment
  5. Working hour
  6. Holidays
  7. Working area

Written Statement

It is usually made for employees, the content on the written statement are following:

  1. Contract finished date
  2. Notice period
  3. Collective agreement
  4. Pension (If any)
  5. Whom to reach if any problem occur
  6. Complain about dismissal

Note: If anything change in these statements employer must notify to employee.

Terms implied by court

Following are the duties of an Employee toward his Employer

  1. Obey duties and reasonable orders
  2. Mutual co-operation and person duties in reasonable manner.
  3. Work with care and skills
  4. Duty should perform with honesty
  5. Do not give your work to other unless employer give you permission.

Duties of an Employer toward his Employee

  1. Reasonable Salary
  2. Indemnify the employee means if an employee pay for something for company the employer must pay him.
  3. Safe and relax environment
  4. Reasonable notice for termination
  5. Mutual Co-Operation
  6. Sufficient work
  7. Good reference

Employment Right Act 1996

Main points:

  1. Right not to be unfairly dismissal
  2. Have to pay redundancy payment if it made
  3. Right to give minimum notice period for termination if a contract.

Working time regulation 1998

  1. Working hours should be 48 hours a week
  2. Paid leave for four weeks
  3. One day can take leave or can off in a week

Employment Act 2002

Parents have right for requesting flexible time or hours of duty if their child or children are disabled or too young.

Equality Act 2010: everyone is equal no one should be judge on anything (height, gender, color etc).

National minimum wage Act 1998: Imposed minimum level of pay a day.

Wrongful and Unfair dismissal

Minimum Notice Period: If an employer want to fire an employee he has to give a minimum notice period so he can find another job for his survival.

Wrongful dismissal: Fire an employee without any notice (term used for this situation is “summary dismissal” or before fixed period of time.

Unfair dismissal: Fire or terminate an employee without any logical or valid reason.

Constructive dismissal: employee leave the job because of wrong conduct of employer.

An employee can be dismissed with these fair reasons:

  1. Because of lake of capacity or efficiency
  2. Qualification
  3. Way or conduct of working
  4. Redundancy (but have to pay somethings in this case)

Inadmissible reason for dismissal

  1. Victimization of health and safety or compliant or whistle blower
  2. Pregnancy or maternity leave rights
  3. Membership or non- membership activities
  4. Statutory right taken
  5. Unfair redundancy

Remedies for unfair dismissal

Reinstatement: Returning to the same job or same position.

Re-engagement: other or comparable employment

If these two not then compensation is the last option.


Employee is fire because of no need for it means there is no any longer need for that particular work or business.

Redundancy can occur because of shutting off the business, closing of an office or no more need for that particular work.

In redundancy case employer should consult with employee otherwise this will be a unfair dismissal.

Notes: If 20 or more employees at same time redundant in one place within 90 days of period,” this is called “Collective Redundancy“. But before doing this we have to notify related authorities.

Redundancy pay

  • Basic reward for unfair dismissal
  • Employer must give 4 weeks time to employer to find new job.

Hopefully you have cleared all your views on “Employment law”. All the important points of Employment law is discussed in this post, you do not need to read anything else after reading these notes. It will clear all the concepts of “Employment law” topic.

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