A breach of employment contract occurs when an employer fails to adhere to the terms of an employment contract. Where such a breach arises, an employee may be entitled to sue for the damage suffered as a result of the breach. Employment contracts may be created orally, in writing, or be partly oral and partly written. Employment contracts can also include terms found in other documents, including awards, agreements, and job descriptions.

The usual remedy for breach of contract is the awarding of damages. In some cases an injunction can be sought to restrain a termination of employment that is a breach of the employment contract. We can advise you about your rights under your employment contract and what you can do if your employer breaches the contract.

Nikolich v Goldman Sachs

Nikolich v Goldman Sachs [2006] FCA 784 and [2007] FCAFC 120

Mr Nikolich was a financial advisor with Goldman Sachs who brought a claim for breach of contract in relation to his supervisor’s bullying and harassment, alleging that it constituted a breach of the workplace bullying and harassment policy.

The Court held that the company policy, sent to the employee at the same time as the letter of appointment, formed part of the employment contract with Mr Nikolich.

In making its decision, the Court referred to a number of factors that indicate a company policy as being contractually binding rather than being merely aspirational:

• promissory language, such as “comply” and “abide”;
• obligatory language, such as “duty” and “ensure”; and
• a specific reference to obligations, rather than a general reference to obligations.

The Court also considered it highly relevant that the employee was required to sign off on the document to stipulate that they had read and understood the policy.

The Court awarded Mr Nikolich a significant 6-figure settlement in compensation.

Commonwealth Bank of Australia v Barker

Commonwealth Bank of Australia v Barker [2013] FCAFC 83

Mr Barker brought a breach of contract claim against his long standing employer, the Commonwealth Bank, alleging that the Bank had breached the employment contract by its failure to comply with its own redeployment procedure in the event of redundancy.

The Court found that the Commonwealth Bank had breached the implied term of mutual trust and confidence, and in turn breached Mr Barker’s contract of employment.

The Court awarded Mr Barker a significant 6-figure settlement in compensation.