A Theory of the Contract of Employment

ABSTRACT The law of the contract of employment has been described as a field based on the idea of contract but shaped by the influence of labour legislation. The article proposes a theory that justifies a specific version of this fusion, offering a principled foundation for the judicial development of the law and for interpreting contracts of employment. It starts by explaining why contracts of employment are unique and why the general law of contract cannot apply. I then argue that the law of the contract of employment should be understood as advancing two sets of goals, those of contract law and those of labour law, proposing a different hierarchy between them in different situations. Some substantive principles are then derived from this general structure: a duty of good faith; preventing evasion from legal obligations; the primacy of reality; the limits of consent; respect for human rights; non-symmetry in applying contract law; and the importance of specialised labour courts or tribunals.