Fixed Term Contract Meaning (UK Only)
Fixed Term Contract Meaning
Many employees think that Fixed-Term contracts are an easy way to hire and fire employees and avoid the complications of employment law and the risk of tribunal. This is an incorrect assumption.
Workers on Fixed-Term employment contracts have very similar employment rights to permanent employees and employers must therefor ensure that Fixed-Term employee are treated fairly both during employment and when being terminated.
Download Fixed Term Contracts
If you are looking to employ someone on a fixed term basis, try the TheCareerCafe.co.uk Fixed Term Employment Contract UK 2022
We are also an affiliate partner with Law Depot and can recommend their Do-it-yourself Employment Contract too if this contract doesn’t meet your needs.
This article explains Fixed Term Contracts Meaning and what your obligations are as an employer are to Fixed-Term employees.
A Fixed term employment contract is a contract that ends on a particular date, after a certain event or on completion of a task. Fixed term employment contracts are commonly used in seasonal work and project work and to cover maternity periods, but fixed term contracts are applicable in a variety of situations.
You should be aware that Fixed-Term Workers have the same minimum rights as permanent workers. You must not treat fixed term employees less favourably than permanent employees, who perform the same or similar role, unless there is good reason to do so.
Fixed-Term employees are entitled to:
- the same pay and conditions
- the same or equivalent benefits package
- access to an occupational (company pension scheme) , except perhaps where the fixed term contract is less then two years
- be informed about permanent employment opportunities in the organisation
- protection against redundancy or dismissal because you are fixed-term
Ending the Fixed Term Contract
Typically a fixed term employment contract will end automatically when they reach the agreed end point, (as mentioned above), so as an employer you do not need to give any notice. But, you are required to act fairly and follow the correct procedures.
Employers must follow a minimum three stage procedure when ending a fixed term contract and this is shown below:
- The employer must write to the individual, inviting them to a consultation meeting. The letter should explain the situation, the reason for the meeting and the agenda.
- The employer must hold a consultation meeting to discuss the situation. The agenda will be as follows:
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- Discuss the reasons why employment may come to an end;
- Hear whether the employee believes that employment could be continued and, if so, how;
- Discuss what alternative work may be available; and
- Discuss the consequences for the employee if their employment cannot be extended.
3. The employer must offer the employee a right to appeal against the decision
If an employer fails to follow the minimum 3 step procedure the dismissal could automatically be deemed as unfair and the employer could be taken to tribunal.
How long can an employer keep on renewing a fixed-term contract?
An employee can be kept on successive fixed-term contracts for a limit of four years. If the contract is renewed after that the employee will become a permanent employee. This is unless the employer can show a good reason why the employee should stay on a fixed-term contract. Only service from 10 July 2002 is counted towards the four-year limit.
The four-year limit was introduced to prevent employers abusing the use of successive fixed-term contracts to limit employees’ employment rights. The limit can be changed by employers and employees agreeing a ‘workforce’ or ‘collective’ agreement. This agreement should then provide an alternative scheme for preventing the abuse of fixed-term contracts.
Workplace or collective agreements can vary the limit on the length or number of successive contracts used by an employer. They can also limit the use of successive contracts and set a list of reasons to justify renewals of fixed-term contracts.
Download Fixed Term Contracts
If you are looking to employ someone on a fixed term basis, try the TheCareerCafe.co.uk Fixed Term Employment Contract UK 2022
We are also an affiliate partner with Law Depot and can recommend their Do-it-yourself Employment Contract too if this contract doesn’t meet your needs.
References:
Department for Work and Pensions – Ending and Renewing Your Fixed-Term Contract.
Department for Work and Pension – Fixed Term Employee Protection
