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Breach of Employment Contract Letter – Meaning, Consequences, Guidelines, Samples, Examples, and More

June 14, 2022
HR Toolkit

When the contract is being written between the employee and the employer, both the parties should abide by the agreements stipulated in the contract. Not following what’s written in the contract may result in suspension, or worse, termination of employment.

Breach of contract happens when an employer or the employee breaks at least one of the clauses written in the contract. To put a remedy to the breach, a new contract is made in order to streamline things.

What is a Breach of Employment contract Letter?

A Breach of Employment contract letter is a general HR Process that is used for recording a breach in the contract signed with the employer.

If an employee violates a contract, you as an employer should try to settle the matter informally with the employee, but you can also sue him/her for the damages caused. The most common breaches of agreement by an employee are when:

  • They quit the job without prior notice to the employer.
  • They go and work for the competitor when it is not allowed in the contract.

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Legal Consequences to Breach of a Contract

There can be two types of employment contract breach namely, material breach and non-material breach. Material breach refers to the failure in abiding by the serious clauses in the agreement whereas,

Non-material breach refers to the violation of lesser serious parts of the employment contract.

For the material breach, the employer can:

  • Sue the employee and recover applicable damages, and
  • is exempt from fulfilling their contractual obligations and has the option to withdraw from the contractual situation if they detect a breach of contract.

For non-material violations, the employer can:

  • Sue for damages that are caused by the employer.
  • Still do their responsibility as stipulated in the contract.

Breach of Employment Contract Examples

There are various examples of an employer-employee contract breach. Since the violation can be done by both the parties, the most common examples of:

Employer Breaching the Contract

  • Unlawful reduction in staff salary.
  • Wrong dismissal.
  • Making changes in the working hours and other employment terms in the contract without approval.
  • Travel expenses, holiday rights, and contractual sick pay are not paid.
  • Without an unconditional job offer after the candidate has accepted the job.
  • Failure to follow correct procedures for grievances, disciplinary actions, and dismissals.

Employee Breaching the Employment Contract

  • Quitting the job without serving the appropriate notice period
  • Gross misconduct
  • Breaching restrictive covenants

Can an Employer Sue the Employee for Violation of Employment Contract

The brief answer is, Yes. However, this shouldn’t be an employer’s first course of action. If you think that an employee has breached the contract, you should first try to solve the matter informally.

Employers may ask for damages, but only if they can prove that the business suffered financial losses from the actions of the employee. For instance, if an employer quits the job without serving the notice period and the company suffers a financial loss, you can sue the employee for the same.

Moreover, if an employee violates the restrictive covenants like accepting a job offer from a competitor or setting up a business similar to that of yours, you can apply to the court for an injunction to stop them.

However, as said earlier, your first course of action should be settling the matter internally, you can do this by issuing a Breach of employment contract letter to the employee.

There are several HRMS Softwares that provide free customized HR letters in order to reduce redundant work. However, this blog has all the necessary details that will help you in writing an effective letter for breach of the employment contract.

Read further to see the sample and examples for the same.

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Guidelines to Write a Breach of Contract Letter

  • Make your letter clear and to the point.
  • Write your opinion that there has been a breach of contract.
  • Specify the terms in the original contract and explain how they were breached.
  • Offer some solution or compromise for the breach, if possible. Do not try to immediately make a threatful situation.
  • End on a cautious yet positive tone.

Breach of Employment Contract Letter

Note: This letter will be useful to you! You can edit it, as your needs and requirements.

Breach of Employment Contract Letter Format

Breach of Employment Contract Letter Format

Breach of Employment Contract Letter Example

Breach of Employment Contract Letter Example

Conclusion

It is very important to issue a Contract Breach letter to the employees violating the rules of the company mentioned in the contract. As we all know, everyone is busy these days and no individual has got time to sit and write the letters, hence, we have made it easier for you.

UBS HRMS Software’s HR Toolkit is the solution for your problem. We provide HR letters that can be used by anyone according to their requirements. No matter if you are a company or an individual, you can use our letter formats just after making some amendments.

Use this sample breach of employment contract letter just by editing it live on the website. Yes, you read it right!! UBS is the very first HRMS Software India that offers a live editing feature for the user’s convenience. Book a demo now to see how our software works.

Alpesh Vaghasiya

Alpesh Vaghasiya

The founder & CEO of Ultimate Business Systems Pvt. Ltd. (UBS), I'm on a mission to help small and medium-sized companies to grow to the next level of accomplishments. With a distinctive knowledge of authentic strategies and team-leading skills, my mission has always been to grow businesses digitally. The core mission of UBS is Connecting people, Optimizing the process, Enhancing performance.

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