← LW: all sections
ACCA · Applied Skills

LW: Employment

16 free practice questions on employment, Section C of the ACCA Corporate and Business Law (LW: English) (LW) question bank. Topics include Unfair dismissal, Employee versus self-employed, Implied duties of employer, Implied duties of employee, Termination by notice, Constructive dismissal. Each question carries its syllabus reference and a worked explanation. Practise them in the quiz with instant feedback, or read every question with its answer further down this page.

→ Full LW question bank and timed mock exam
→ LW Common Mistakes

Explanations shown after each answer. Skip freely. No time limit.
Section:
0
answered
0
correct
—
score
—
remaining
Question 1

Loading questions…

All 16 employment questions

The same questions the quiz above draws on, in syllabus order, each with its answer and worked explanation. All 16 are multiple choice.

Question 1 · Syllabus ref C1a · Employee versus self-employed

Which of the following is a recognised test the courts use to decide whether a worker is an employee rather than self-employed?

  1. Whether the worker is paid weekly rather than monthly
  2. Whether the worker has signed any document headed "contract"
  3. Whether the worker is described as "self-employed" in the agreement
  4. The multiple (or economic reality) test, considering control, integration and whether the person is in business on their own account
Show answer and explanation

Answer: D. The courts use tests such as control, integration and, most importantly, the multiple or economic-reality test, asking whether the person is genuinely in business on their own account (Ready Mixed Concrete). Options A, C and B are all irrelevant to employment status. Correctly classifying a worker matters for statutory rights, tax and vicarious liability, so the substance of the relationship is examined, not superficial features.

Question 2 · Syllabus ref C1b · Implied duties of employer

Which of the following is an implied common law duty owed by an employer to an employee?

  1. A duty to provide a reference in all circumstances
  2. A duty to take reasonable care for the employee's health and safety
  3. A duty to guarantee the employee's promotion
  4. A duty to pay a bonus every year
Show answer and explanation

Answer: B. Among the implied duties an employer owes is to take reasonable care for the employee's health and safety, alongside duties to pay agreed wages and maintain mutual trust and confidence. Option A is wrong — there is generally no duty to provide a reference, though any reference given must be accurate. Options C and D are wrong — there is no implied duty to promote or to pay discretionary bonuses.

Question 3 · Syllabus ref C1b · Implied duties of employee

Which of the following is an implied duty owed by an employee to their employer?

  1. A duty of faithful service, including to obey lawful and reasonable instructions
  2. A duty to invest personal savings in the employer's shares
  3. A duty to work without any pay
  4. A duty to indemnify the employer against all business losses
Show answer and explanation

Answer: A. Employees impliedly owe a duty of faithful service: to act in good faith, to obey lawful and reasonable orders, and to exercise reasonable care and skill. Option B is wrong — there is no duty to buy shares. Option C is wrong — employees are entitled to be paid. Option D is wrong — employees are not general insurers of the employer's business losses, though they may be liable for their own negligence.

Question 4 · Syllabus ref C2a · Termination by notice

What does the lawful termination of an employment contract by notice require?

  1. No notice at all in any circumstances
  2. Immediate dismissal without reason in every case
  3. Giving the period of notice required by the contract or by statute, whichever is greater
  4. The employee's written consent to be dismissed
Show answer and explanation

Answer: C. Lawful termination by notice requires giving at least the greater of the contractual notice period or the statutory minimum notice. Option A is wrong — notice is generally required unless summary dismissal is justified. Option B is wrong — dismissing without notice is lawful only where the employee has committed a repudiatory breach. Option D is wrong — the employee's consent is not required for a lawful dismissal on notice.

Question 5 · Syllabus ref C2b · Constructive dismissal

What is meant by constructive dismissal?

  1. Dismissal by the employer with full notice and a generous payment
  2. Any resignation by an employee, whatever their reason for leaving
  3. Dismissal because the employee's job has genuinely ceased to exist
  4. Where the employee resigns in response to a serious (repudiatory) breach of contract by the employer, entitling them to treat themselves as dismissed
Show answer and explanation

Answer: D. Constructive dismissal occurs where the employer commits a serious, repudiatory breach of the employment contract and the employee resigns in response, reasonably promptly; the law treats the employee as having been dismissed. Option A describes an ordinary, fair dismissal on notice. Option C describes redundancy. Option B is too wide — a resignation unconnected to any employer breach is not constructive dismissal.

Question 6 · Syllabus ref C2c · Wrongful dismissal

Wrongful dismissal is best described as a dismissal that:

  1. Breaches the terms of the contract, typically by failing to give proper notice
  2. Is automatically fair in all cases
  3. Can only ever be claimed by company directors
  4. Depends solely on the length of the employee's service
Show answer and explanation

Answer: A. Wrongful dismissal is a contractual claim: it arises where the employer dismisses in breach of contract, most often by giving no or insufficient notice. It is distinct from unfair dismissal, which is a statutory claim. Option B is wrong — wrongful dismissal is by definition a breach. Option C is wrong — it is not limited to directors. Option D is wrong — it turns on breach of the contract terms, not solely length of service.

Question 7 · Syllabus ref C2d · Unfair dismissal — fair reasons

Which of the following is a potentially fair reason for dismissal under statute?

  1. The employee's membership of a trade union
  2. Capability or conduct of the employee
  3. The employee being pregnant
  4. The employee asserting a statutory right
Show answer and explanation

Answer: B. Potentially fair reasons for dismissal include capability or qualifications, conduct, redundancy, statutory illegality, and some other substantial reason. Options A, C and D are all automatically unfair reasons for dismissal: dismissing for trade-union membership, pregnancy, or asserting a statutory right is automatically unfair regardless of the procedure followed.

Question 8 · Syllabus ref C2e · Remedies for unfair dismissal

Which of the following is a remedy that an employment tribunal may award for unfair dismissal?

  1. Imprisonment of the employer
  2. A criminal fine payable to the state
  3. Reinstatement, re-engagement, or compensation
  4. An order that the employee buy shares in the company
Show answer and explanation

Answer: C. The statutory remedies for unfair dismissal are reinstatement (the old job back), re-engagement (a comparable job), or compensation (a basic and a compensatory award), with compensation being the most common. Option A is wrong — unfair dismissal is not a criminal matter. Option B confuses it with criminal penalties. Option D is irrelevant to the tribunal's powers.

Question 9 · Syllabus ref C2f · Redundancy

For the purpose of a statutory redundancy payment, redundancy generally arises where:

  1. The employee has been guilty of gross misconduct
  2. The employer dislikes the employee personally
  3. The employee simply wishes to retire early or to change career voluntarily
  4. The employer has ceased or intends to cease the business, or the need for employees to do work of a particular kind has ceased or diminished
Show answer and explanation

Answer: D. Redundancy arises where the employer ceases (or intends to cease) carrying on the business, ceases business at the employee's location, or where the requirement for employees to do work of a particular kind has ceased or diminished. Option A describes a conduct dismissal, not redundancy. Option C is a voluntary resignation/retirement. Option B would point to an unfair dismissal, not a genuine redundancy situation.

Question 10 · Syllabus ref C1a · Control test for employment status

A worker is told not only what to do but exactly how, when and where to do it, and provides none of their own equipment. Which test and likely outcome applies?

  1. The control test, suggesting they are self-employed
  2. The integration test, suggesting they are a client of the business
  3. The economic-reality test, suggesting they run their own business
  4. The control test, suggesting they are an employee
Show answer and explanation

Answer: D. A high degree of control over how, when and where the work is done points towards employment under the control test. Option A reaches the wrong conclusion — extensive control indicates employment, not self-employment. Option B misuses the integration test and the label 'client'. Option C is wrong — being directed exactly how to work is inconsistent with being in business on one's own account.

Question 11 · Syllabus ref C1b · Written statement of particulars

What does an employee have a statutory right to receive regarding the terms of their employment?

  1. Nothing in writing at all
  2. A full formal contract drafted by a solicitor
  3. A written statement of the main particulars of employment
  4. A binding guarantee of lifetime employment
Show answer and explanation

Answer: C. Employees and workers are entitled to a written statement of the main particulars of employment — covering matters such as pay, hours and job title — on or before their first day. Option A is wrong — the right to written particulars exists. Option B is wrong — a solicitor-drafted contract is not required. Option D is wrong — no guarantee of lifetime employment exists in law.

Question 12 · Syllabus ref C2d · Unfair dismissal — qualifying period

Generally, what continuous period of employment must an employee have served to bring an ordinary claim for unfair dismissal?

  1. No qualifying period is ever required
  2. Six months
  3. Five years
  4. Two years, subject to exceptions for automatically unfair reasons
Show answer and explanation

Answer: D. An ordinary unfair dismissal claim generally requires two years' continuous employment, but dismissals for automatically unfair reasons (such as pregnancy, whistleblowing or asserting a statutory right) require no qualifying period. Option A is wrong for ordinary claims. Options B and C state the wrong length. The automatically-unfair exceptions to the two-year rule are an important point to remember.

Question 13 · Syllabus ref C2d · Automatically unfair dismissal

Which of the following dismissals would be regarded as automatically unfair, requiring no qualifying period of service?

  1. Dismissal for persistent lateness after warnings
  2. Dismissal for genuine redundancy following proper consultation
  3. Dismissal of an employee for making a protected disclosure (whistleblowing)
  4. Dismissal for incapacity due to lack of qualifications
Show answer and explanation

Answer: C. Dismissing an employee for making a protected disclosure (whistleblowing) is automatically unfair and needs no qualifying period. Options A and D are potentially fair conduct or capability dismissals if handled properly. Option B is a potentially fair redundancy dismissal where proper procedure is followed. Only option C falls within the automatically-unfair category.

Question 14 · Syllabus ref C2b · Summary dismissal

In which circumstance is an employer entitled to dismiss an employee summarily (without notice)?

  1. Whenever the employer wishes to avoid paying notice
  2. Where the employee has been employed for less than one year
  3. Where trade is temporarily quiet
  4. Where the employee has committed a serious (gross) breach of contract, such as gross misconduct
Show answer and explanation

Answer: D. Summary dismissal without notice is lawful only where the employee has committed a repudiatory breach, such as gross misconduct. Option A is wrong — dismissing without cause to save notice is a wrongful dismissal. Option B is wrong — short service does not by itself justify summary dismissal. Option C describes a possible redundancy, which still requires notice or pay in lieu.

Question 15 · Syllabus ref C2f · Redundancy payment basis

A statutory redundancy payment is calculated by reference to which factors?

  1. The employer's annual profit
  2. The number of customers the business has lost
  3. The employee's age, length of continuous service and weekly pay, subject to statutory caps
  4. The value of the company's issued share capital
Show answer and explanation

Answer: C. A statutory redundancy payment is based on the employee's age, their length of continuous service (capped at 20 years) and their weekly pay (subject to a statutory maximum). Options A, B and D are irrelevant to the statutory formula — the entitlement depends on the individual employee's service profile, not the company's finances or customer numbers.

Question 16 · Syllabus ref C2a · Statutory minimum notice

What is the statutory minimum notice an employer must give to an employee who has six complete years of continuous employment?

  1. One week, regardless of length of service
  2. Three months
  3. No notice is required at all
  4. Six weeks — one week for each complete year, up to a maximum of twelve weeks
Show answer and explanation

Answer: D. The statutory minimum notice from an employer is one week for each complete year of continuous employment, between one and twelve weeks; six years' service therefore gives six weeks. Option A ignores the service-based increase. Option B is not the statutory measure. Option C is wrong — notice is required unless summary dismissal is justified. A contract may provide for more, but not less, than the statutory minimum.

Other LW topics

Advertisement