Fixed Term Employment Agreements are used for work confined to the duration of a specific task or project. This type of agreement can be useful if funding is available for a limited time or if a project has a finite duration. Fixed-term agreements are those that specify the employment will be terminated on a particular date or event.

For example, an employee engaged for an interior design project will complete the term of employment when that project is completed to a satisfactory standard. If a project is abandoned or discontinued, any fixed term employment contract linked to its completion needs to include this contingency as an additional trigger for termination.

Fixed Term Employment may be a fitting choice to replace employees who are absent for a set period of time such as for long service leave or parental leave, or to work on a particular finite or short term project.

Fixed term employees are generally entitled to the same wages and conditions of employment as full-time or part-time employees, depending on the hours worked, but on a proportionate basis according to their period of employment.

The fixed term employment agreements must clearly define the specific task or project. The agreement operates for the specific period of time specified by the parties. The length of the agreement cannot be ambiguous if using a fixed term agreement. The agreement must state when the agreement begins and lapses. When the agreed end date is reached, the agreement will automatically expire without either party needing to terminate it.

It is essential for employers to be aware of how they intend to employ an employee if a fixed term agreement is used. It is not feasible for a fixed term contract of employment to run for 5 years, which cannot be terminated by either party with 30 days notice. This is not a fixed term agreement. The best way to approach a lengthy fixed term agreement is to ensure the agreement can be terminated before the expiry date noted in the agreement by one party giving the other a specified period of notice.

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