The Fair Work Act has been amended and includes new laws regarding job security, notably fixed-term contracts. Under certain conditions, employers can no longer enter certain fixed-term contracts with an employee.

Here’s what you need to know.

From 6 December 2023, the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 includes new legislation regarding fixed-term contracts.

Employers can now only enter into a fixed-term contract with an employee under certain conditions including:

• Contract periods can be no longer than 2 years (including extensions)
• Contracts may not be extended more than once, or if entering a new contract, it can’t be for the same or a substantially similar role as previous contracts over the last 2 years.

Additionally, it is now prohibited for employers to take any action that would circumvent these limitations.

However, there are a number of exceptions to this legislation, such as:

• when an employee has specialised skills that the employer needs for a specific task;
• when the employee is part of a training program;
• during peak periods or emergencies.
• the employee is covered by an award that allows fixed-term contracts in the above circumstances

Below is a snapshot of the changes from the Fair Work Ombudsman.

What does this mean for your organisation?

Employers with fixed-term contracts should review the new legislation and audit and review contracts to ensure compliance, considering any exceptions that may apply.

They should also consider any modern awards that may affect the terms of the contracts and tailor them to the needs of their organisation.

Visit the Fair Work website for all the information:
https://www.fairwork.gov.au/newsroom/news/new-rules-for-fixed-term-contracts

Source:

To read the full Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022: https://www.legislation.gov.au/Details/C2022A00079

© Fair Work Ombudsman www.fairwork.gov.au

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