If you have a short term need for extra staff in your business you may be considering what is the best option to fill the requirement, particularly if you’re hoping a fixed term contract or other similar arrangement will relieve you of some of the responsibilities which come with employing permanent staff. Here’s a quick guide to the specific rights of temporary staff to make sure you don’t come unstuck.
Employee or worker?
Casual staff or seasonal workers, particularly on a zero hours contract where the employer doesn’t have to offer work and the worker can refuse offers of work, usually have- worker’ status rather than employee status.
If they are classed as- workers’ they have fewer rights than employees, but perhaps more than you’d think. For example they accrue holiday, must be paid at least National Minimum Wage, are eligible for tax and NI contributions, may qualify for statutory sick pay and are protected by legislation relating to discrimination, working time, whistleblowing and health and safety.
However if your temporary member of staff works regular hours, has clearly defined duties and would be disciplined or dismissed if they didn’t attend work, they are likely to have employee status. This means that other than the temporary nature of their engagement, they are exactly the same as permanent employees.
Continuity of employment rights for fixed term employees
In terms of statutory employment rights, these are based on continuity of service with the same employer, rather than whether a contract says the employee is permanent or not. This means that regardless of the fixed term nature of the work, you need to look at how long the employee has worked for you when determining what their statutory rights are.
You must also bear in mind that consecutive fixed term contracts will all count towards continuity of service, and- gaps’ in employment can also be included, if the gap is very short or is due to a temporary cessation of work.
Specific protection for fixed term employees
As well as accruing statutory rights based on length of service just as their permanent colleagues do, fixed term employees have specific rights under the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002.
These regulations state that unless the employer is able to justify objectively any differences in treatment, employees on a fixed-term contract must not be treated less favourably than a comparable permanent employee.
A comparable employee is one who is engaged at the same place in the same or broadly similar work, taking into account qualifications and skills where that is relevant. Sometimes there isn’t a comparable employee at the same workplace, in which case someone at an alternative location can be used for comparison.
Things to consider when it comes to ensuring fixed term employees aren’t treated less favourably include terms and conditions in a contract, including access to benefits both immediately and based on length of service, and training and promotion opportunities including access to vacancies for both fixed term and permanent work.
The Regulations specifically state that employers must inform fixed term staff of vacancies so that they have the opportunity to obtain permanent (or additional fixed term) work with the employer.
Renewal of contracts
The protection fixed term employees have also impacts on the ending and possible renewal of contracts. If the need for the work the employee is doing has ended, the reason for dismissal will probably be redundancy, and if the employee has been with you at least two years, he or she will be entitled to redundancy pay just as a permanent member of staff would.
If you are making redundancies generally, you can’t select a fixed term employee because of their fixed term status, you should consider them together with permanent staff.
If the employee’s fixed term contract is coming to an end but the work is continuing and you could easily renew but are just choosing not to, it may be determined that the fixed term contract ending isn’t the main reason for dismissal. If this is the case and your fixed term team member has two years’ service, you are risking a claim for unfair dismissal.
Overall when making decisions in your business, you should not take the fixed term nature of any employee’s contract into account, and should treat them just as you would permanent staff.
If you are concerned about how to meet your obligations to fixed term workers, or are wondering how to apply things like service-related contractual benefits to staff who have an end date to their employment, do get in touch for some advice.