Labour Law

If it is the servant who unlawfully throws up the employment, the master is likewise entitled to bring an action for damages for any loss he sustains, though naturally such an action is rare. The employer cannot retain any wages actually due to be paid when the servant breaks off the contract, but the servant cannot claim wages for a broken period in respect of which wages would have been due if it had been completed. For instance, if a servant subject to, and liable to give, a month's notice on the first of each month, leaves in the middle of the month, he cannot claim any wages due since the last monthly pay day (George v. Davies [1911], 2 K.B. 445). If the contract is quite definitely to serve for a specified time and be paid a specified sum at the end of it the servant cannot recover any wages at all if he does not complete the contract, and his representatives cannot even recover any part i of the wage in respect of the time he actually served, if he dies in the course of the service, because nothing has accrued due (Cutter v. Powell, 1795, 6 T.R. 320). Where it is the employer who breaks off the contract it must be noted that the servant, whatever the terms of payment may be, can always recover wages in respect of the service actually accomplished, by ignoring the broken con tract and suing on a quantum meruit, i.e., on an implied contract to be paid for work actually done, if for any reason he prefers this course.

There is no obligation on a master, in English common law, to give a servant anything of the nature of a certificate of employ ment or of character, when the engagement comes to an end (note, however, certain statutory provisions on this subject in the Merchant Shipping Act 1894).

Illegal Contracts.

It has, so far, been assumed that the con tract of service is a legal one. We must now turn to the circum stances in which English law regards a contract as illegal and con sequently either wholly or partly void. A contract of service, like any other contract, is illegal if it involves the doing of something which the law either expressly forbids (such as the employment of children below a statutory age limit) or merely discourages as being contrary to public policy (such as one too greatly infring ing a man's liberty of action or "in restraint of trade"). The illegal ity may go to the root of the contract rendering it wholly void. Or, on the other hand, one or more illegal terms may be held not to vitiate the whole of the contract. Thus where a miner was working under an agreement by which he was paid in a manner contrary to the Coal Mines Regulation Act 1887, it was held that the contract as a whole held good in spite of this illegal stipula tion, and the miner was not entitled to leave his employment with out giving the fortnight's notice required by the contract (Kear ney v. Whitehaven Colliery Co. [1893], I Q.B. 700). For an ex ample of a contract involving a direct and punishable infringe ment of the law which wholly vitiated it, we may note the case of Pountney v. Turton (1917, 10 B.W.C.C. 601), where a boy was employed before reaching the age of 14 contrary to the Em ployment of Children Act 1903. His contract being in consequence wholly illegal and void, it was held that he could not recover com pensation for an accident under the Workmen's Compensation Act, and to remedy this unjust result of the illegality of the con tract the Workmen's Compensation Act had to be amended (see s. 3 [3] of the consolidating Act of 1925). The most important type of contract of service contrary to public policy but not in volving the doing of any punishable offence, is where undue re straint is placed upon personal liberty of action, especially any "restraint of trade." "The law of England allows a man to contract

for his labour, or allows him to place himself in the service of a master, but it does not allow him to attach to his contract of service any servile incidents" (Davies v. Davies, 1887, 36 Ch. D. at p. 393). Thus a man cannot contract to submit to imprison ment at the hands of his master if he should be guilty of mis conduct (Clarke v. Gape, 1596, 5 Rep. 129). Moreover, although, as we have seen, the courts will not refuse to enforce a contract merely for the reason that it appears to be unfair to one party or that the consideration is inadequate, they will interfere where a party is unduly fettered in his right to dispose of his labour as he will or his liberty of action in other respects so that he is reduced to an almost servile condition (see Horwood v. Millar's Timber Co. Ltd. [1917], K.B. 305). In the absence of servile in cidents a contract to serve another for life is not necessarily void (Wallis v. Day, 1837, 2 M. and W. 273) ; but the common law will not allow an agreement to be enforced by which workmen bind themselves to work or masters bind themselves to employ workers, only on terms decided by a majority of those affected (Hilton v. Eckersley, 1856, 6 E. and B. 47). Thus it is impossible for members of workers' or employers' associations to bind them selves under penalty to abide by the decisions of the majority, and no collective agreement made by such associations can ever be enforced by process of law.

The doctrine of restraint of trade is especially important in connection with contracts purporting to restrict the activities of an employee after he leaves his employment. It is, as we have seen, an implied term in all contracts of service that the servant shall keep faith with his master and not divulge his trade secrets or take an unfair advantage of his position and knowledge either during the service or after it has come to an end (Amber Size Co. v. Menzel [1913], 2 Ch. 239). But it is not unusual to insert in the contracts of employees in positions of some responsibility or requiring special skill, or in which they acquire special knowledge, provisions binding them not to exercise their skill or use their knowledge in competition against their former masters either in particular districts or for a certain number of years after the employment comes to an end. There have been many important decisions on this subject. These were summed up in Attwood v. Lamont ([1920], 3 K.B. 571). The chief points to notice are: firstly, that any such contract is prima facie bad, as being in re straint of trade, so that the onus is on the party trying to enforce it to show that it is reasonable in the circumstances; secondly, that it must be reasonable from the point of view of both par ties ; thirdly, that as a master is not entitled to bar the competi tion, as such, of a servant who has quitted his employ, no restraint can be justified except in so far as it may be required for the pur pose of preventing the servant from making improper use of his acquaintance with his master's customers or knowledge of his trade secrets. The remedy where such terms have been proved to be reasonable is usually the recovery of damages. In some cases the courts have granted injunctions to restrain an ex-servant from breaking a restrictive agreement of this sort. But they will only do this with great caution (see Rely-A-Bell Burglar and Fire Alarm Co. v. Eisler [192o], Ch. 609).