Fixed Term contracts of employment – how to ensure that you have smooth sailing

Fixed term contracts of employment have attracted a lot of attention in the news over the last couple of years due to major judgements on how they should be applied, and how employers use these contracts. We have seen some major decision going against employers where a ‘fixed term  contract employee’ has won a case to be deemed permanent.

We outline some tips to ensure that employers get this right and don’t fall into any of the potential traps:

1) Get the contract right at the start – ensure that you issue a contract (immediately) clearly stating that this is a fixed term contract and state the exact start and finish dates. Also, clearly state the exact nature of the position and the purpose of the role, and if the position is subject to funding, state this clearly and also the potential risks involved.

2) Fixed term contracts of employment should not be used as a trial for a permanent position – you can use a good probation period for a permanent position

3) NEVER let a fixed term contract finish date lapse without either letting the employee go, or issuing a new contract to continue the relationship

4) Employers can issue several fixed term contracts up to a maximum period of 4 years-  then a decision must be made if you plan to keep the individual permanently or not

5) Manage the employee- just because they are on a fixed term contract doesn’t mean that an employer shouldn’t expect good performance and be able to manage the individual

Lastly, maintain a detailed tracking of all documentation, contracts and performance in case there are any queries or issues with the relationship.