When it comes to the hiring of workers for a fixed period of time, employment law is governed by the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002. Employers use fixed-term contracts for seasonal or casual work and work during peak periods, projects that need specialist skills and for covering maternity leave or holidays. The workers are not regarded as fixed-term if they work for an agency, are on work experience, are an apprentice or a member of the armed services. The contract will end at a specified date or when the project is completed.
The regulations state that employers cannot treat a fixed-term worker less favourably than comparable full-time workers unless there is a justifiable reason. So, unless there are special circumstances, a worker on a fixed-term contract will have the same rights as a permanent employee. A worker should have arrangements that are similar to other workers for pay, conditions, benefit packages, pensions, tax, and holidays.
Employment law regards any worker as permanent if he or she has worked on fixed-term contracts for four years or more. Genuine business reasons are exceptions to this. After two years, the worker will have the same protection from unfair dismissal as other workers.
When the contract ends, the employer may not want to renew it. If the contract is renewed but there is no agreement about how long it is, then employment tribunals would regard the employment as permanent. An employment tribunal is unlikely to regard a non-renewal of a fixed-term contract as unfair dismissal. If the employee has worked over two years then they will have the same redundancy rights as others. Discrimination on equality grounds is illegal from day one.
These regulations do not apply to apprentices, students with a year or less of work experience, or people on certain training courses and temporary work schemes.
Part-time workers have the same rights as full-time workers under The Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000. Less favourable treatment can only be justified if it directly supports a legitimate business objective, is needed to achieve the objective and if it is an appropriate way to achieve it. Less favourable treatment may relate to terms and conditions of a contract, or disadvantage suffered due to acts or omissions by an employer.
Less favourable treatment
Less favourable treatment of part-time and fixed-time workers can be justified in an employment tribunal on the ‘pro-rata’ or ‘objective justification’ principles. For pro-rata, the employer admits less favourable treatment but justifies it on the basis that it was proportionate to the terms offered to other workers. An example, mentioned above, is holidays for part-time workers. A ‘package’ approach for fixed-term contracts, allows the employer to pay the worker at a higher rate than others.
In particular cases, employment tribunals are likely to take into account the precise concrete factors in the conditions of employment and whether the employer used an objective criteria.