The term of trust and confidence
Published by a LexisPSL Employment expert
Last updated on 16/10/2019

The following Employment practice note provides comprehensive and up to date legal information covering:

  • The term of trust and confidence
  • The nature of the term or duty
  • Examples of breach
  • Dismissal in breach of trust and confidence
  • Alleging the employee breached the term
  • Relationship with express terms
  • Whether breach of the implied term is always repudiatory
  • Employer’s intention
  • Reasonable and proper cause
  • Where the employee is already in breach
  • More...

The term of trust and confidence

This Practice Note analyses the term or duty of mutual trust and confidence (in a fiduciary sense) implied or imposed into every contract of employment.

The nature of the term or duty

Every contract of employment is treated as containing a term of trust and confidence. This requires employers and employees not to conduct themselves, without reasonable and proper cause, in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between employer and employee. The term can affect every aspect of the relationship between employer and employee and creates a ‘catch all’ means of describing unreasonable conduct in employment. It is a two-way duty, binding on both employer and employee.

While the term of trust and confidence is often referred to as an implied term, it is better to think of it as an imposed term because, unlike implied terms, it cannot be excluded by an express term. For further information, see Practice Note: Types of contractual term in employment—Implied terms.

Mutual trust and confidence has two different strands:

  1. treating each other with respect and civility

  2. not treating each other in a wholly unreasonable manner: note that it is not possible to say there is a positive duty to act reasonably

Examples of breach

Not all forms of unreasonable behaviour would be a breach of this term. Behaviour must

Related documents:
Key definition:
Trust and confidence definition
What does Trust and confidence mean?

An term'>implied term in the employment relationship that applies to both the employer and employee.

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