Long-term fixed contracts that extend beyond four years could soon become a thing of the past, according to a leading Scottish law firm.
Kim Pattullo, an employment lawyer with Shepherd and Wedderburn, has warned that employers must be able to ‘objectively justify’ any further fixed-term agreements with staff who have worked at the firm for more than four years.
Staff with four or more years’ continuous service who have had their contract renewed must now be treated as permanent employees, unless a further fixed-term agreement can be legally justified for business reasons.
Pattullo urged employers to carefully manage these types of contracts as the definition of ‘objective justification’ is still unclear, and could affect as many as 1.3 million workers.
“The law went a long way in 2002 to provide parity between fixed-term workers and comparable permanent staff,” she said. “Now, the law goes one step further in requiring employers to objectively justify any further use of a fixed-term contract after four years’ continuous service.
“Until case law evolves on the interpretation of objective justification, employers will need to be wary of the risk of continuing to have fixed-term contracts for more than four years. They would also be wise to implement an audit system for monitoring the operation of fixed-term contracts, and potentially offering fixed-term staff permanent contracts where appropriate,” she said.