On 9 March the Government
issued a consultation paper and draft regulations detailing its proposals for
new statutory protection for fixed-term employees. The consultation is due to
finish on 31 May and regulations must be in force to implement the EC Directive
on Fixed Term Working in UK law by 10 July. Fixed-term employees work under a
contract of employment which is fixed for a term in advance or which has a
specified end-date.
Aims of the regulations
The regulations are intended to
prevent less favourable treatment of fixed-term employees against comparable
permanent staff and to prevent the abuse of successive renewals of contracts.
The draft regulations contain the following rights for fixed-term employees:
– The right to be notified by
the employer of any suitable alternative vacancies (ie, non-fixed term) that
may arise
– The right not to be treated
less favourably than a comparable non-fixed term employee engaged in the same
or broadly similar work, either in connection with terms and conditions of employment
or being subject to detriment. The less favourable treatment may be defended on
the grounds of objective justification, and
– A fixed-term employee who
suspects less favourable treatment can ask for a written statement of reasons
for that treatment.
A breach of the regulations
will entitle an employee to complain to an employment tribunal to obtain the
usual raft of remedies; namely a declaration of rights, a recommendation that
the employer take remedial action or compensation based on loss.
If an employee has been working
for four years or more under a series of fixed-term contracts, the employee’s
contract will be deemed by law to become an indefinite contract and any attempt
to fix the term will be void. This new provision is intended to address “real
abuses” of fixed-term contracts. This new four-year provision will not be
retrospective and any continuity of employment before the regulations come into
force will not count. Whether four years is appropriate is one of the key
questions on which the Government is consulting.
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Practical effect
Unfair dismissal waivers in
fixed-term contracts were made unlawful by the Employment Relations Act 1999.
The Government is now consulting on making void any waiver of statutory
redundancy payments in fixed-term contracts. But for these waivers, there is
often little difference in practice between terms offered to permanent and
fixed-term staff. Many employers already make details of permanent vacancies
available to all. At this stage the best practical advice is to review the
terms of fixed-term employment contracts to ensure that fixed-termers are not
being less favourably treated than comparable permanent employees.
