Fixed-term Employees in Australia: Incidence and Characteristics

Staff Research Paper Addendum

This addendum to the staff research paper, Fixed-term Employees in Australia: Incidence and Characteristics, contains additional information about the termination of employment provisions of the Workplace Relations Act 1996.

At pages 2 - 3, the Paper states that if a fixed-term contract allows termination of the contract at any time with notice, courts have determined that it is not a ‘contract of employment for a specified period of time' for the purposes of the WR Regulations and therefore employees may not be excluded from making unfair dismissal claims.

• It should be noted that section 170CD of the WR Act provides that the federal termination of employment laws only apply where there has been a termination of employment at the initiative of the employer. Even if a purported fixed-term contract allows termination with notice, if the employment is not terminated until the specified period of the contract expires, then the termination of employment will generally not be a termination of employment at the initiative of the employer. Employees in this situation would not be able to make a termination of employment claim under the WR Act, and the exclusion in WR Regulation 30B(1) would not be relevant.
• It should be noted that the Australian Industrial Relations Commission has decided that where a fixed-term contract can be or is terminated for cause (for instance, misconduct), the employee will still be excluded under WR Regulation 30B(1) from making a termination of employment claim.

The Paper states in footnote 5 on page 6 that the avoidance of unfair dismissal claims might provide an incentive to an employer to engage an employee under a fixed-term contract. However, as indicated on page 3 of the Report, ‘The decisions […] mean that employers can not avoid unfair dismissal claims by engaging (and then terminating at will) employees under fixed-term arrangements', as a consequence of:

• WR Regulation 30B(2), which provides that the exclusion of fixed-term contract employees from termination of employment remedies does not apply if a substantial purpose in engaging an employee under a contract for a specified period is to avoid obligations under the termination of employment provisions.