Contract Law - Mutual Trust and Confidence: Catalysts, Constraints and Commonality

What this page is about: The implied obligation of mutual trust and confidence has assumed, in a short space of time, considerable significance within the law of the employment contract. The decision of the House of Lords in Johnson v Unisys [2003] 1 AC 518 demonstrates that statute may serve to constrain its growth. This article explores whether other statutory rights are likely to have a similar impact upon the implied term. The article goes on to explore whether the influence of public law values will constrain mutual trust's capacity to regulate an employer's discretionary powers. The article concludes by asking whether mutual trust's future development may be influenced by the standards and ethics of Human Resource Management.

Industrial Law Journal
ILJ 2008 37 (329)
1 December 2008
Douglas Brodie, University of Edinburgh, email: jbrodie@staffmail.ed.ac.uk
© Oxford University Press 2008

TRADE INDUSTRY AND INDUSTRIAL RELATIONS

The case law on mutual trust and confidence has become decidedly voluminous and there's little sign of its growth abating. Its expansion has progressed more or less unhindered; the exception being, and a major one at that, the restriction imposed by Johnson v Unisys.1

In Johnson, the House of Lords held that the employer's capacity to dismiss isn't restrained by the implied obligation and that the natural growth of the common law should be halted because it threatened to undermine legislative policy.2

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