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Employment contract
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See: Labour economics and Contemporary slavery

A contract of employment is a category of contract used in labour law to attribute right and responsibilities between parties to a bargain.

On the one end stands an "employee" who works Wikipedia:wages or salary which, in the capitalist sector, is less than the net gains of their labor, "employed" by an "employer", which or who obtains the difference between the pay and the net gains. It has arisen out of the old master-servant law, used before the 20th century. Put generally, the contract of employment denotes a relationship of economic dependence and social subordination. In the words of the controversial labour lawyer Sir Otto Kahn-Freund,

"the relation between an employer and an isolated employee or worker is typically a relation between a bearer of power and one who is not a bearer of power. In its inception it is an act of submission, in its operation it is a condition of subordination, however much the submission and the subordination may be concealed by the indispensable figment of the legal mind known as the 'contract of employment'. The main object of labour law has been, and... will always be a countervailing force to counteract the inequality of bargaining which is inherent and must be inherent in the employment relationship."[1]

Wikipedia:Template:Syndicalism sidebar Wikipedia:Template:Anarchism sidebar

Anarcho-syndicalists and other socialists who criticise wage slavery, e.g. Wikipedia:David Ellerman and Wikipedia:Carole Pateman, posit that the employment contract is a legal fiction in that it recognises human beings juridically as mere tools or inputs by abdicating responsibility and self-determination, which the critics argue are inalienable. As Ellerman points out, "[t]he employee is legally transformed from being a co-responsible partner to being only an input supplier sharing no legal responsibility for either the input liabilities [costs] or the produced outputs [revenue, profits] of the employer's business."[2] Such contracts are inherently invalid "since the person remain[s] a de facto fully capacitated adult person with only the contractual role of a non-person" as it is impossible to physically transfer self-determination.[3] As Pateman argues:

The contractarian argument is unassailable all the time it is accepted that abilities can 'acquire' an external relation to an individual, and can be treated as if they were property. To treat abilities in this manner is also implicitly to accept that the 'exchange' between employer and worker is like any other exchange of material property . . . The answer to the question of how property in the person can be contracted out is that no such procedure is possible. Labour power, capacities or services, cannot be separated from the person of the worker like pieces of property.[4]



A contract of employment usually defined to mean the same as a "contract of service".[5] A contract of service has historically been distinguished from a contract for the supply of services, the expression altered to imply the dividing line between a person who is "employed" and someone who is "self-employed". The purpose of the dividing line is to attribute rights to some kinds of people who work for others. This could be the right to a minimum wage, holiday pay, sick leave, fair dismissal, a written statement of the contract, the right to organize in a union, and so on. The assumption is that genuinely self-employed people should be able to look after their own affairs, and therefore work they do for others should not carry with it an obligation to look after these rights.

In Wikipedia:Roman law the equivalent dichotomy was that between locatio conductio operarum (employment contract) and locatio conductio operis (contract for services).[6][7]

The terminology is complicated by the use of many other sorts of contracts involving one person doing work for another. Instead of being considered an "employee", the individual could be considered a "worker" (which could mean less employment legislation protection) or as having an "employment relationship" (which could mean protection somewhere in between) or a "professional" or a "dependent entrepreneur", and so on. Different countries will take more or less sophisticated, or complicated approaches to the question.

Terms and conditions of employmentEdit

The focus of most employment contracts is Wikipedia:wages for work, but a typical written employment contract will contain a multitude of provisions relating to the terms and conditions of employment. However other essentialia negotii (essential terms) might be notice periods in the event of dismissal, holiday pay rights, the place of work and pension schemes. Many jurisdictions require these factors to be set out in a written contract.[8] In terms of pay, the employee may be compensated through Wikipedia:wages, a Wikipedia:salary, or by commission. In addition to monetary compensation, the employment contract often specifies a Wikipedia:fringe benefit package, including a Wikipedia:retirement plan, Wikipedia:employee stock options, Wikipedia:holiday entitlement, required hours of work, and (especially in the US) Wikipedia:health insurance benefits.

Normally, such contracts provide for termination of employment, by either party, and include associated matters such as notice period, compensation arrangements and, sometimes, Wikipedia:garden leave.

Some employers use non-disclosure and Wikipedia:non-compete clauses to protect their Wikipedia:trade secrets from being dispersed when employees leave. Depending on where people live, the laws regarding enforceability of these clauses vary widely.

United States Edit

  • Wikipedia:Adair v. United States, 209 U.S. 161, 175 (1908) "the employer and the employee have equality of right and any legislation that disturbs that equality is an arbitrary interference with the liberty of contract which no government can legally justify in our free land.”

European UnionEdit

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Employment contract
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  • Wikipedia:Lawrie-Blum v Land Baden-Wurttenberg C-66/85 [1986] ECR 2121, para 17, "That concept ['worker'] must be defined in accordance with objective criteria which distinguish the employment relationship by reference to the rights and duties of the persons concerned. The essential feature of an employment relationship, however, is that for a certain period of time a person performs services for and under the direction of another person in return for which he receives remuneration."

United KingdomEdit

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Employment contract
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Main article: Wikipedia:UK labour law

Wikipedia:UK law holds that employment contracts have implied terms (assumed, unspoken, essential terms), as well as explicit terms (typically those in writing). Legal precedent provides for example that there is an implied contractual term of trust and confidence, meaning each party to the contract is expected to behave in a manner allowing the other to maintain trust and confidence in the other.

Russia Edit

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Employment contract
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Main article: Wikipedia:Russian labour law

While some countries guarantee recourse to law for breach of employment contracts, Russia's Labour Code standardizes the form and content of labour contracts. The Code guarantees that every employment contract include:

  1. Place of work
  2. Employment function as defined by the Code
  3. Wage conditions
  4. Working hours and rest periods
  5. Compensation for heavy work and work with hazardous working conditions
  6. Nature of work (mobile, traveling etc)
  7. Compulsory social insurance

See alsoEdit

External links Edit


  • Mark Freedland, The Personal Employment Contract (2003) Oxford University Press, ISBN 0-19-924926-1


  1. Labour and the Law, Hamlyn Lectures, 1972, 7
  2. Ellerman 2005, p. 16.
  3. Ellerman 2005, p. 14.
  4. Ellerman 2005, p. 32.
  5. in the UK, s.230 Wikipedia:Employment Rights Act 1996
  6. see, Sir John MacDonell, Classification of Forms and Contracts of Labour (1904) Journal of the Society of Comparative Legislation, New Series, Vol. 5, No. 2, pp. 253-261, at 255-256
  7. "locatio conductio operarum is a contract whereby one party agrees to supply the other with a certain quantum of labour. locatio conductio operis is a contract whereby one party agrees, in consideration of money payment, to supply the other not with labour, but with the result of labour." Sohm, Institutes of Roman Law, 311 (1892)
  8. In the European Union, see Directive 91/533


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