When fixed term contracts may be helpful to businesses

With less than 3 months to go until Christmas, businesses and individuals alike are starting to think about preparing for the big day. Companies with a seasonal trade that spikes during the festive season, such as retailers, restaurants, hotels and events companies, will often have the need to take on additional staff in the run up to Christmas. For these types of businesses, fixed term contracts can be an extremely useful tool via which to bring in additional skills and labour to cope with increased demand.

Having said this, those businesses that utilise fixed term contracts will need to be aware of a number of key points in relation to taking on staff under such terms, as explained below…
• A fixed term contract is a type of employment contract that lasts for a specified time, or will end when a specified task or event has been completed. If the employment finishes on the agreed date, the employer will normally not need to give notice. However, if the work ends before the agreed end date the employer will need to give the appropriate notice period, provided the contract itself allows the worker to be dismissed.
• Staff employed under fixed term contracts are protected against less favourable treatment compared to permanent employees. This means that they are entitled to the same pay and conditions as permanent staff, the same or equivalent benefits and information regarding any permanent vacancies within the organisation. The only exception to this is if an employer can give justifiable business reasons for casual staff to be treated less favourably.
• Due to the flexible nature of taking on additional resource during peak times, seasonal workers are often engaged on a part-time basis. Again, part-time employees and workers are entitled to protection from less favourable treatment compared to their full time and permanent counterparts.
• There is a legal requirement to provide all employees whose employment is to continue for more than one month with a written statement outlining the main terms and conditions of their employment. Whilst employers should aim to do this before the employment commences, it must be done no later than two months after the period of employment begins.
• It is also important to note that employees who have been continuously employed for four years or more on a series of successive fixed-term contracts may automatically be deemed to be a permanent employee. Those employed for a period of 2 years may automatically become entitled to redundancy rights.
Despite the legal requirements associated with fixed term contracts, this is often by the most efficient and flexible way for employers to take on additional resource for short periods. However it is key that employers issue the appropriate contract to the employees in order to protect the business, for the reasons set out above.

Contact Pam McColl or Amanda Isherwood by email or call us on 0161 312 1864 for a no obligation chat about putting fixed term contracts in place in your business, or indeed any other matter.