What is a fixed-term contract?

A "fixed-term contract" means a contract of employment that, under its provisions dealing with how it will terminate in the normal course, will terminate:

• on the expiry of a fixed term;
• on the completion of a particular task; or
• on the occurrence or non-occurrence of any other specific event other than the attainment by the employee of a bona fide normal retirement age (NRA).

Who is covered by the Fixed-term Employees Regulations?

Notably, the Fixed-term Employees Regulations only apply to employees.

Unfair dismissal and statutory redundancy payments

The expiry of a "limited-term contract" without renewal under the same contract will count as a dismissal for unfair dismissal and redundancy purposes.

An employment contract is a "limited-term contract" where:

• The employment under the contract is not intended to be permanent; and
• Provision is made in the contract for it to terminate by virtue of a "limiting event", which is defined as:
  • the expiry of a specific fixed-term,
  • the performance of a specific task, or
  • the occurrence or non-occurrence of an event.

Unfair dismissal waivers

Historically, it was possible for employees recruited to work on fixed-term contracts with a fixed term of over two years to contract out of their right to claim unfair dismissal on the expiry of their contract. The inherent inequality of the relative bargaining positions between employer and employee in these agreements was recognised some time ago and, since 25 October 1999, it has not been possible to contract out of the right to claim unfair dismissal on the non-renewal of a fixed-term contract. Subject to certain conditions, however, waivers included in fixed-term contracts or renewals of fixed-term contracts of over two years which were entered into before 25 October 1999 will continue to have effect.

Discrimination against fixed-term employees

The Fixed-term Employees Regulations introduce the concept of parity of treatment between fixed-term employees and comparable permanent employees. Fixed-term employees are entitled not to be treated less favourably than comparable permanent employees by reason of their fixed-term status, unless the employer is able to objectively justify the different treatment. A fixed-term employee has the right not to be treated less favourably than a comparable permanent employee:

• As regards the terms of their contract.
• By being subjected to any other detriment by any act, or deliberate failure to act, of their employer.
• The opportunity to secure any permanent position in the establishment

Protection from dismissal and detriment

A fixed-term employee has the right to claim that a dismissal is automatically unfair if the reason or principal reason for the dismissal is that they have done (or the employer believes or suspects that they have done or intends to do) any of the following:

• Brought proceedings against the employer under the Fixed-term Employees Regulations.
• Given evidence or information in connection with proceedings brought by any employee under the Fixed-term Employees Regulations.
• Otherwise did anything under the Fixed-term Employees Regulations in relation to the employer or any other person.
• Alleged that the employer had infringed the Fixed-term Employees Regulations (provided the allegation is not false and not made in bad faith).
• Refused (or proposed to refuse) to forgo a right conferred on him by the Fixed-term Employees Regulations.
• Declined to sign a workforce agreement for the purposes of the Fixed-term Employees Regulations.

All workers (including employees) have the right not to be subjected to any detriment by any act, or any deliberate failure to act, done by the employer on any of the above grounds.

A detriment is made out if a reasonable worker would or might take the view that he or she had been disadvantaged in the circumstances in which he had to work.