Brain food: Workplace rights - Employer or adviser?

It's well known that employers have a duty to ensure the health and safety of their staff. But what about their financial security? Many organisations operate remuneration schemes containing small-print conditions on the ability of employees to enjoy or maximise particular benefits. In some cases, the courts will say there is an implied obligation on an employer to take reasonable steps to make an employee aware of a valuable contract term, especially where it depends on the employee taking certain action. Employers should be careful to bring such provisions to staff's attention by means of explanatory booklets, induction briefings and so on. But the Court of Appeal recently rejected the notion of a general duty on all employers to take reasonable care of their employees' economic wellbeing. The case involved a senior employee whose decision to retire early on medical grounds meant he lost substantial benefits under a contractual health insurance scheme. His claim that the employer should have warned him of the consequences was rejected. The position is different where employers expressly assume responsibility for giving financial advice: they will then be liable for any losses caused by advice that turns out to be negligent.

by Michael Burd and James Davies, Lewis Silkin solicitors, e-mail:
Last Updated: 31 Aug 2010

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