Fixed-term vs. Indefinite-term Contracts

In a fixed-term contract, an employee has an agreement with the organization they are working for, but their contract ends on a specific date or upon completion of a specific task. In an indefinite-term contract, the employee has an agreement with the organization they are working for, but their employment has no specified end date.

Employee Rights

Employees on a fixed-term contract are entitled to the same treatment as employees on an indefinite-term contract. It's possible for an employer to have different terms for a fixed-term contract employee if they can show there is a good business reason for doing so. Otherwise, employers must ensure that fixed-term employees receive:

• the same pay and conditions as permanent staff

• the same or equivalent benefits package

• information about permanent vacancies in the organization

• protection against redundancy or dismissal

Terminating a Fixed-term Contract

The contract will typically end automatically on the agreed-upon date, and no notice is needed from the employer.

Not Renewing a Fixed-term Contract

When a contract is not renewed, it is considered a dismissal. If the employee has provided at least two years of service, the employer must show that there is a fair reason for not renewing the contract. An employee may not be unfairly dismissed after two years of service and is entitled to a written statement of reasons for not renewing the contract after one year of service.

The employee may be entitled to statutory redundancy payments if they have provided two years of service and the reason for non-renewal is redundancy.