
Top stories






More news











Marketing & Media
Chicken Licken bravely debones a rare phobia with their latest campaign
Joe Public 3 days



The South African legislature recognises the vulnerable position of employees on fixed-term employment contracts. As the termination of the limited duration contract does not constitute a dismissal, as a rule, the employee is deprived of the right to challenge the fairness of the termination of employment. Employees have the right to a fair dismissal, but where the termination of employment does not constitute a dismissal for the purposes of employment law, ergo there can be no unfair dismissal that may be subject to legal challenge. Other typical examples of terminations that do not constitute dismissal include retirement, resignation and termination by agreement or mutual consent. However, limited duration employees receive statutory protection in that:
The LAC had to consider the status of employees where the limited duration employment contracts expired, but the employees were allowed to continue working past the contractual termination date. It confirmed an earlier decision that the employment contract tacitly novated into an agreement for open-ended employment. Having regard for the 2009 decision quoted by the LAC on this issue, we caution that the facts of each case will determine the extent of the novation of the limited duration agreement.
The LAC judgment should not be regarded as establishing an immutable position that all LDCs will become permanent where employees are continued to be employed after the expiry date. Factors such as non-variation clauses, communication between the parties and other evidence on the agreed intention of the parties could defeat a claim of novation into indefinite employment, in our view. However, there is a clear risk that the court may accept that the employment contract continued on the same terms save for the expiry date, which no longer applies.
Employers may minimise their employment law risk in respect of LDCs by ensuring that:
Even more so in 2020 and beyond, fixed-term employment contracts are valuable business tools that allow employers flexibility to manage the volatile business world. Contracting an employee as cover for a team member on maternity leave will remain a sound business practice. Facing an unfair dismissal claim or being saddled with additional headcount because no-one monitored the expiry of replacement employee's contract is decidedly not good for business.