A fixed- term or temporary worker is employed under a contract of services, which is characterised as having a defined end point. The contract may be one of a fixed duration for example one year, or one that will end when a specific event occurs such as the completion of a project. These contracts can be beneficial to both employee and employer. There is no legal limit to the duration of a fixed term contract.

The fixed- term employee has all of the same rights and responsibilities as a permanent employee. He or she is entitled, among other things to:

  • terms of employment in writing
  • appropriate hours of work and breaks
  • pay that is not less than the minimum wage
  • a safe place of work
  • protection from unfair dismissal during the term of the contract
  • rights in respect of redundancy
  • protection in respect of transfers of undertakings
  • protection in relation to industrial relations

The fixed-term employee is also given certain protections under the Protection of Employees (Fixed-Term Workers) Act 2003. He or she is entitled to equal access to training and opportunities for professional development.

He or she is generally protected from treatment less favourable to that of a permanent employee who does  similar work or work of equal or greater value.

If less favourable treatment does arise, the employer must be able to demonstrate either that the fixed-term worker’s contract is at least as favourable as their comparator’s contract, as a whole. Alternatively, he or she must demonstrate that there are objective grounds for the disparity in treatment. There must also a legitimate objective for the difference in treatment, and this reason cannot be simply a cost saving. The difference in treatment must be necessary and proportionate to achieve the objective.

If an employer is going to treat a fixed-term worker differently, he or she must have considered all other options in relation to achieving the objective and he or she must have consulted with the employee.

There is a derogation from the rules in respect of pensions where it is allowable to treat a fixed-term worker less favourably, if he or she works less than 20 per cent of the hours of the comparator. This is justified in by the expense involved in providing a pension.

Employers have a duty to inform fixed-term workers of vacancies for permanent positions, but  are not obliged to automatically offer the role to the temporary worker.

The biggest and most frequent issues arising around fixed-term contracts are successive fixed-term contracts. If an employer intends to renew a fixed-term employment contract, he or she must inform the employee in writing, in advance of the contract expiry of the objective reason justifying another fixed-term. If the employer fails to do this the second employment contract is deemed to be a permanent contract.

If the original fixed-term contract began after 14th July 2003, the employee may be employed for two or more continuous fixed terms for up to four years. Any renewal after four years must be justified by a strong objective reason.

Employers should exercise caution in respect of their treatment of fixed-term employees, and should only use this type of contract if there is a legitimate reason for it. It should never be used merely as an avoidance of providing job security or as an alternative to proper business planning.

The above is intended for information purposes only, and is not intended to be relied upon as legal advice. Please contact us on 01 -676 3257 for advice specific to your needs. We, at Fitzsimons Redmond, would be delighted to work with you and your business in relation to tailoring appropriate contracts of employment for your business.

By Lisa Quinn O’Flaherty, solicitor at Fitzsimons Redmond