Fixed-term employment: What members need to know
Fixed-term contracts can leave employees uncertain about whether they will have a job from one year to the next, making it harder to plan their careers, finances and family lives.
Fixed-term employment can be appropriate where there is a genuine temporary need, but it should not be used as the default for work that is ongoing.
Contact the MSU if you have concerns about your employment arrangements. Challenging an inappropriate fixed-term arrangement can make an important difference to your job security and employment entitlements.
How the IEU can help
Your union has long worked to reduce insecure fixed-term employment. Through bargaining, the IEU has won Agreement protections that make ongoing employment the norm and temporary employment the exception – in many workplaces before federal law caught up.
IEU staff also support members on inappropriate or rolling fixed-term arrangements, helping many get ‘made ongoing’, challenging unjustified contracts, enforcing Agreement and legal rights, and negotiating with employers on a member’s behalf.
Contact the MSU for advice if any of the following apply:
You are an ongoing employee and are suddenly issued a new contract or letter converting you to fixed term.
You return from extended leave and are advised your position will be fixed term.
You return from parental leave part-time and are told you must move
onto a fixed-term contract.You are offered a subsequent fixed-term contract for the same or similar work
You are told you are replacing someone on parental or other leave, but the employer cannot identify who you are replacing.
You are described as a replacement employee, but the work does not appear to be genuine replacement work.
Your employer simply says your role depends on ‘annual funding’, without clearly explaining why this requires your employment to be fixed term.
A significant proportion of a particular group of staff (such as LSOs, aides or graduate teachers) are employed on fixed-term contracts.
Your employer cannot clearly explain why your role must be fixed term.
Your Agreement may provide stronger protection
The Fair Work Act sets general limits on fixed-term contracts, but Awards and Agreements can impose stronger restrictions on when fixed-term employment may be used.
Catholic Agreements in Victoria and Tasmania require ongoing employment except in specified circumstances, with provisions covering temporary projects and tasks, replacement employees and some other defined circumstances. Similar protections also appear in IEU-negotiated Agreements in the independent school sector.
For most employees covered by an IEU-negotiated Agreement, the employer must identify the reason for fixed-term employment in the letter of appointment by reference to the relevant Agreement provision. If you are employed as a replacement, you are entitled to ask who you are replacing.
An employer cannot simply call a position ‘fixed term’ and leave it at that. The reason for the arrangement, the applicable Award or Agreement and the Fair Work Act all matter.
Changes to the law
On 6 December 2023, new fixed-term contract rules came into effect as part of the Secure Jobs, Better Pay reforms, restricting rolling fixed-term arrangements. The IEU had long advocated for stronger limits and welcomed reforms addressing over-reliance on fixed-term contracts in education.
Before the reforms, rolling fixed-term contracts were common in non-government education, with some employees remaining on successive contracts for years. The federal rules added another layer of protection alongside the safeguards unions had already won through bargaining.
Your right to information
Employers must provide a Fixed Term Contract Information Statement (FTCIS) to an employee entering into a fixed-term contract, in addition to the Fair Work Information Statement provided to all new employees. The FTCIS explains employees’ rights and the legal limits on fixed-term contracts, including limits on their use, employer obligations and circumstances in which exceptions apply.
The rules on fixed-term contracts
Unless an exception applies, a fixed-term contract made on or after 6 December 2023 generally cannot:
run for longer than two years, including extensions or renewals
be extended or renewed so the total period exceeds two years
include more than one option to extend or renew the contract.
There are also restrictions on consecutive fixed-term contracts. An employer generally cannot offer a new fixed-term contract where the previous contract was fixed term, both contracts are for the same or similar work, and there is substantial continuity in the employment relationship and one or more of the following applies:
an option to extend the previous contract was used
the combined period of the contracts exceeds two years
the new contract contains an option to renew or extend it
there was an earlier fixed-term contract for the same or similar work with substantial continuity of employment.
Anti-avoidance protections also prevent employers from taking steps designed to bypass these rules, such as ending employment for a period, employing someone else to perform substantially similar work, or changing duties or employment arrangements.
Some IEU-negotiated Agreements contain additional protections against setting the duration of fixed-term employment so as to avoid entitlements that would otherwise apply to an ongoing employee, such as payment
for non-term weeks.
Appropriate use of fixed-term contracts
Fixed-term employment can be appropriate where there is a genuine temporary need – for example, to undertake a time-limited project or replace an employee who is on a defined period of leave.
Under the Educational Services (Teachers) Award, fixed-term employment is generally limited to between four weeks and 12 months and may be used to:
undertake a specified project for which funding has been made available (for example, a non-recurring government grant for specialist teaching)
undertake a specified task with a limited period of operation (for example, a distinct or identifiable project or role)
replace an employee who is on leave, temporarily performing other duties, or whose employment has ended after the start of the school year (for example, covering parental leave or long service leave).
Where a replacement arrangement extends beyond 12 months, the fixed-term employment may be extended for up to a further 12 months.
If you are offered a fixed-term contract, have been employed on successive fixed-term contracts or are unsure why your employment has been limited to a specified period, contact the IEU’s Member Services Unit for advice – preferably before signing.
