Question
Explain in simpler terms Duty of Mutual Trust and Confidence
The duty of mutual trust and confidence means that the employer must not work in a manner that
is calculated or is likely to destroy the mutual trust and confidence between the parties. This
formulation was affirmed in the leading case of Malik v Bank of Credit and Commerce
International.41This duty is based on fairness as an integral and necessary requirement of a
contract of employment. In Malik the plaintiff Bank in liquidation was found liable for stigma
damages for having run a fraudulent banking operation. The court supported the argument that
the bank’s actions had rendered the plaintiffs unemployable through their association with the
defendant bank and awarded damages. Anemployer’s acts that are calculated or likely to injure
the reputation of the employee fall under this general common law duty
The duty of mutual trust and confidence means that the employer must not work in a manner that
is calculated or is likely to destroy the mutual trust and confidence between the parties. This
formulation was affirmed in the leading case of Malik v Bank of Credit and Commerce
International.41This duty is based on fairness as an integral and necessary requirement of a
contract of employment. In Malik the plaintiff Bank in liquidation was found liable for stigma
damages for having run a fraudulent banking operation. The court supported the argument that
the bank’s actions had rendered the plaintiffs unemployable through their association with the
defendant bank and awarded damages. Anemployer’s acts that are calculated or likely to injure
the reputation of the employee fall under this general common law duty
Answers
GPT-4o mini
The "Duty of Mutual Trust and Confidence" means that employers and employees should treat each other with respect and fairness. This duty requires that employers should not do anything that would damage the trust and confidence that exists between them and their employees.
For example, in the important case of Malik v Bank of Credit and Commerce International, the court found that the bank had acted unethically, running a fraudulent operation. As a result, the employees who worked there suffered negative consequences, such as damage to their reputation, which made it hard for them to find new jobs. The court decided that the bank was responsible for this harm, as their actions broke the trust between them and the employees.
In simple terms, employers should avoid actions that could unfairly harm their employees’ reputation or trust in the workplace.
For example, in the important case of Malik v Bank of Credit and Commerce International, the court found that the bank had acted unethically, running a fraudulent operation. As a result, the employees who worked there suffered negative consequences, such as damage to their reputation, which made it hard for them to find new jobs. The court decided that the bank was responsible for this harm, as their actions broke the trust between them and the employees.
In simple terms, employers should avoid actions that could unfairly harm their employees’ reputation or trust in the workplace.