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Keep your contract, payslips, and any written promises. If the breach is financial, the paper trail usually decides the case.
The Grievance Survival ToolkitBreach of contract: a guide to your rights
Your employment contract is legally binding. When your employer fails to honour its terms, you may have the right to recover your losses.
Your employment contract is a legally binding agreement between you and your employer. When either party fails to honour its terms, it is known as a "breach of contract." While minor issues can often be resolved informally, a serious breach can give you the right to take legal action to recover any financial losses you have suffered.
This guide explains what constitutes a breach of contract in the workplace, the most common types of claim, and the legal processes involved.
1. What is a breach of contract?
A breach of contract occurs when your employer fails to do something they are required to do under your contract, or does something they are not allowed to do. The terms of your contract are not just what is written down; they also include terms that are verbally agreed, or are "implied" by law.
- Express terms: the written terms in your contract of employment, offer letter, or staff handbook — such as your salary, working hours, and notice period.
- Verbal terms: promises made verbally, for example during your interview or in a one-to-one meeting, can also form part of your contract.
- Implied terms: duties that the law automatically includes in every contract — such as the employer's duty to provide a safe working environment and the duty of mutual trust and confidence.
If your employer breaches a term, the first step is usually to raise the issue informally, and then formally through a grievance if that fails. This creates a record and gives them a chance to fix the problem.
2. Common types of breach of contract claim
Unpaid wages
Unlawful deduction from wages
The breach: your employer fails to pay your agreed salary, overtime, or contractual bonus — or makes deductions you never agreed to.
Your position: most unauthorised deductions are unlawful under the Employment Rights Act 1996. You can claim the money back, and the claim is usually straightforward to evidence with payslips and bank statements.
Notice pay
Wrongful dismissal
The breach: you are dismissed without the notice period in your contract (or statutory minimum notice), and without pay in lieu of notice.
Your position: wrongful dismissal is a pure breach-of-contract claim — no two-year qualifying service is needed. The exception is gross misconduct, which must be genuinely proven.
Bonuses & commission
Withheld contractual payments
The breach: a contractual bonus or commission scheme is not paid out even though you met the conditions.
Your position: if the scheme is contractual rather than discretionary, non-payment is a breach. Even 'discretionary' bonuses cannot be withheld irrationally or in bad faith.
Changing your terms
Unilateral variation
The breach: your employer cuts your pay, changes your hours or location, or removes benefits without your agreement.
Your position: your employer cannot change your contract without your consent. If you are forced to resign as a result, you may have a constructive dismissal claim.
3. Where do you bring a claim?
Breach of contract claims can be brought in the Employment Tribunal or the County Court / High Court, and the choice matters:
| Employment Tribunal | County Court / High Court | |
|---|---|---|
| Time limit | 3 months minus 1 day from the breach (after Acas Early Conciliation) | 6 years from the breach |
| Cap on award | £25,000 | No fixed cap |
| When available | Only if your employment has ended (or the claim arises from it ending) | Available whether or not you still work there |
| Costs risk | Low — costs orders are rare | Higher — the loser may pay the winner's legal costs |
Check the deadline first
If you are still employed, the tribunal route is usually unavailable for a pure contract claim — but an unlawful deduction from wages claim can be brought in the tribunal while you are still employed. Get advice on the right route before you issue anything.
4. What to do next
Raise a formal complaint
A written grievance forces your employer to respond on the record and creates the evidence base for any later claim.
The Letter & Grievance BuilderConsidering a claim?
Time limits are strict — usually three months minus one day in the tribunal. Understand the full process first.
The Employment Tribunal Preparation Toolkit