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Has your boss dismissed you without giving you prior notice? Are you still waiting for that bonus promised in your contract? As an employee, it is your right to bring a claim if you believe your employer has breached your contract. If you are thinking about taking legal action against your employer (or former employer), it’s best to have a firm legal understanding of all the requirements you’ll need to meet. This article sets out five steps you should check off before you take action.

(1) Is There a Contract?

While this may seem like a relatively basic step, often claims for breach of contract do not succeed because the claimant cannot prove to the court that there was a contract in the first place. You must be able to provide evidence that, more likely than not, a contract between you and your employer existed at the time it was allegedly breached.

(2) What Specific Term(s) Has Been Breached?

Before you can sue your employer for a breach of contract, you must first determine whether your contract has actually been breached. You need to be able to identify the precise contractual term (actual or implied) which you allege the employer has breached. 

(3) Is This Term Clear?

Some contractual terms can be ambiguous, and their meaning unclear. If this is the case, you will need to provide the court with an argument about how to interpret the clause. It’s then best to research whether the court has considered a similar term to the one you allege your employer breached in the past, and how they decided its interpretation. For example, if you are arguing that an employer has not fulfilled a clause in your contract. The court may decide to construe the term broadly and then might not view your employer’s actions amount to a breach.

Since analysing the meaning of a term will involve looking into decisions from similar cases and interpreting complex laws, a contract lawyer will be important in making sure you understand the possible outcomes before you take action.

(4) Are There Are Any Time Limitations?

If you believe your employer has breached your contract, it is vital to make sure you lodge your claim before it is too late. Like most kinds of legal action, you have a limited amount of time in which you can sue. It’s important that you fully understand the time limits (and any other limitations) that exist on your claim so that you can achieve the best possible outcome. You should also ensure that you consider any other causes of action which may be available. Except in very limited circumstances, employees only have 21 days following termination of employment in which to lodge a claim.

(5) What are my Damages?

The standard remedy for breach of contract is monetary damages (that is, the court will order money as compensation for losses that resulted from the breach of contract). In some circumstances, you may be able to receive an injunction which stops your employer from terminating your employment. Commencing legal proceedings against your employer, however, can be a time-consuming process. Before you do so, it’s important to weigh up and understand the costs, both financial and emotional, involved with litigation.


Contracts are diverse and complex legal documents, and deciding whether or not you can sue an employer for a breach of contract can be difficult. If you’re not sure whether you can satisfy the above steps, then seeking an experienced lawyer’s assistance is prudent in order to achieve the best possible outcome. If you are an employer and have any questions, get in touch with our employment team on 1300 544 755. 


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