Can employment contracts be verbal?
They certainly can, however, the challenge often lies in establishing the terms and conditions of a verbal agreement.
One Ontario judge recently observed:
There is of course no legal requirement that to be enforceable a contract must be in writing. However, the onus of proving the contract was made is on the propounder.
Not surprisingly, there is often a disconnect between the employer and employee with respect to the terms of a verbal agreement. The onus therefore lies on the party asserting the contract to establish:
- A clear offer;
- An equally clear acceptance of the offer; and
- Valid consideration (something of value passing between each of the parties)
Credibility, of course, plays a critical role in the determination of whether a verbal contract exists, in the context of a dispute. A court will also imply terms into a verbal contract in order to give meaning to the contract. There is, understandably, a great deal of uncertainty which accompanies verbal agreements.
The many pitfalls which accompany verbal agreements are the very reason employers and employees often consider entering into a written employment agreement, whether in the form of an offer letter or a more comprehensive employment contract.
Norman Grosman is one of Canada’s top employment lawyers. He tackles your employment law dilemmas regularly on Workopolis. More information about him and his legal services can be found on his website grosman.com