Employment agreement interpretation

Employment agreement interpretation


Managers or administrators faced with issues concerning employment contract/agreement interpretation should take professional advice beforehand to ensure their understanding of the terms and conditions is consistent with the employer’s contractual obligations.


Set out below are the main rules of contract interpretation developed over many years by the Courts. When considering contract/ agreement interpretation issues, be guided by these rules of interpretation.

  • Do not speculate about the meaning – study the words used to get the meaning.
  • Interpretation should be based on the ordinary meaning of the words used i.e., the common or dictionary meaning.
  • To find the meaning, always read the words in their context, firstly in the whole clause and then in the whole contract/agreement.
  • Where technical terms are specifically used they must be given their technical not ordinary meaning.
  • If a word or expression appears several times it must be given the same meaning each time it appears.
  • Custom and practice may assist in the clarification of ambiguity but not so as to contradict the plain meaning of wording.
  • A specific provision will take precedence over a general clause where there is any conflict.
  • Words in the singular include the plural and vice versa; words in the male gender include the female.
  • Punctuation will not change the plain meaning of words but if there is any doubt, punctuation may affect interpretation.
  • Words used in a clause must not be treated as superfluous or ignored if any meaning can be given to them.
  • Do not read words into a clause that are not there.