Employment contract back dating

Where backdating is done for financial gain, it may also constitute the more dull-sounding criminal offence of obtaining a pecuniary advantage by deception.

Although criminal prosecution might be a risk in serious fraud cases, in most day to day legal matters where backdating occurs for reasons of administrative convenience, or simply by oversight or error, the risk of being charged with a crime are commensurately small.

When we say "backdating" what we usually mean is executing a document and then dating it with an earlier date than the actual date of execution, with the intention that it should be treated as giving rise to legal rights before the actual date.

However, at common law this was a criminal offence (going by the contradictory sounding name of uttering a false document) and in most English law based legal systems it is still an offence today, although in many cases statutory provisions have superseded the common law (for example, in the British Virgin Islands see section 242 of the Criminal Code 1997).

employment contract back dating-18employment contract back dating-29employment contract back dating-69employment contract back dating-4

A commonly used example is where the parties had originally signed a document, but the original had been lost or destroyed before it could be stamped or filed.

However, in each case this could only operate where the contact is a "simple" contract rather than formally executed as a deed (ie signed, sealed and delivered).

For execution as a deed the requirement of signing is a crucial part of the process of creating rights by way of deed, and so it is never permissible to backdate a deed.

To be clear, having a later effective date does not mean that the contract will not be binding until that later date.

The contract is binding when both parties have accepted the contract.

Leave a Reply