Theories of Employment Contracts

Theories of employment contracts explore how and why employment arrangements are created. They include the "offer and acceptance" theory, where a clear proposal from an employer and agreement from the employee form the contract. The "intention to create legal relations" theory emphasizes that both parties intend the contract to be legally binding. The "formal contract" theory views written agreements as essential, while the "implied contract" theory suggests unstated understandings can also govern employment. These theories help clarify legal responsibilities, rights, and obligations between employers and employees within various employment relationships.