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EMPLOYMENT
LEGISLATION
FIXED
TERM WORK
A
guide to the regulations (PL512)
Summary
of compliance guidance
The
Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations come
into force on 1 October 2002. They make certain changes to the way fixed-term
employees are treated by the law and should be treated by their employers. This
guidance note sets out the requirements of these new Regulations, to help
employers who will be affected by them and to let fixed-term employees know what
their new rights are.
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Fixed-term
employees should not be treated less favourably than comparable permanent
employees on the grounds they are fixed-term employees, unless this is
objectively justified.
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The
Regulations apply to: employees on contracts that last for a
specified period of time or will end when a specified task has been
completed or a specified event does or does not happen. Examples include
employees covering for maternity leave and peaks in demand and employees on
task contracts such as setting up a database.
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The
Regulations define ‘permanent’ employees as those who are not on
fixed-term contracts. These employees may more generally be referred to as
employees on contracts for an indefinite or indeterminate term. The term
permanent will be used in this guidance, since it is used in the
Regulations.
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Fixed-term
employees can compare their conditions to:
employees who are not on fixed-term contracts and are employed by the
same employer to do the same or broadly similar work. Where relevant the
comparator should have similar skills and qualifications to the fixed-term
employee. If there is no comparator in the establishment, a comparison can
be made with a similar permanent employee working for the same employer in a
different establishment.
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Less
favourable treatment may be assessed in one of two ways: either each
of the fixed-term employee’s terms and conditions of employment should not
be less favourable than the equivalent treatment given to their comparator
or the fixed-term employee’s overall package of conditions should not be
less favourable. In both instances any less favourable treatment would need
to be justified on objective grounds.
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Clarifying
treatment: A fixed-term employee has a right to ask their employer
for a written statement setting out the reasons for less favourable
treatment if they believe that this may have occurred. The employer must
provide this statement within 21 days.
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The
use of successive fixed-term contracts will be limited to four years, unless
the use of further fixed-term contracts is justified on objective grounds.
However, it will be possible for employers and employees to increase or
decrease this period or agree a different way to limit the use of successive
fixed-term contracts via collective or workforce agreements. For the
purposes of this part of the Regulations, service accumulated from 10 July
2002 will count towards the four-year limit. There is no limit on the
duration of the first fixed-term contract, although if a contract of four
years or more is renewed, it will be treated from then as permanent unless
the use of a fixed-term contract is objectively justified.
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If
a fixed-term contract is renewed after the four-year period, it will be
treated as a contract for an indefinite period (unless the use of a
fixed-term contract is objectively justified).
A fixed-term employee
has a right to ask their employer for a written statement confirming that
their contract is permanent or setting out objective reasons for the use of
a fixed-term contract beyond the four-year period. The employer must
provide this statement within 21 days.
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Any
redundancy waiver that is included in a fixed-term contract
which is agreed, extended or renewed after 1 October 2002 will be invalid.
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Fixed-term
employees should receive information on permanent vacancies in their
organisation.
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From
1 October 2002, the end of a task contract that expires when a specific task
has been completed or a specific event does or does not happen will be a
dismissal in law. The non-renewal of a fixed-term contract concluded for a
specified period of time is already a dismissal in law. Employees on these task contracts of one year or more will have a
right to a written statement of reasons for this dismissal and the right not
to be unfairly dismissed. If the contract lasts two years or more and the
contract is not renewed by reason of redundancy, the employee will have a
right to a statutory redundancy payment.
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From
1 October 2002, employees on fixed-term contracts of three months or less
will have a right to statutory sick pay and to payments on medical
suspension, guarantee payments and the right to receive and duty to give a
week’s notice after one month’s continuous service. These new notice
requirements only apply to a termination of the contract before it is due to
expire. This will put these fixed-term employees on the same footing as
permanent and fixed-term employees on longer contracts.
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If
fixed-term employees believe they are being less favourably treated than a
comparable permanent employee because they are fixed-term or that their
employer has infringed their rights under the Regulations, then they may
present their case to an employment tribunal.
A list
of frequently asked questions relating to the Regulations is available on the ACAS
website. This is updated periodically and may not correspond to printed
versions.
Good practice guidance is available from www.acas.org.uk.
If you have any questions about the
Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations,
please contact your nearest ACAS Helpline (see www.acas.org.uk/contact_us.html
for details).
You can register to be reminded and updated about changes to employment
law and find information on a wide
range of help for small businesses at www.businesslink.org.
Information on these and other aspects of employment legislation can also
usually be provided by accountants, trade unions, citizens advice bureaux, low
pay units, employer organisations and a number of private sector and voluntary
bodies.
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