Fixed Term Contract Information Statement

Employers must give this document to new fixed term employees when they start work.
See fairwork.gov.au/ftcis

Important: New employees also need to be given the Fair Work Information Statement. Visit fairwork.gov.au/fwis

There are new rules that limit the use of fixed

What are the new limitations on using fixed
term contracts. term contracts?
From 6 December 2023, there are rules (called limitations) about the use of
In summary, from 6 December 2023, employers can’t fixed term contracts after this date. There are 3 rules, and all rules need to
employ someone on a fixed term contract: be followed or the contract’s end date will no longer apply, which means the
Ü that is for longer than 2 years contract won’t automatically come to an end at the end of that time.
Ü that has more than one extension option, or
1: Time limitations
Ü where the employee will be employed under
consecutive contracts. A fixed term contract can’t be for longer than 2 years. This includes any
extensions or renewals.
There are exceptions to the new rules that mean they
don’t apply to all fixed term contracts. These rules
2: Renewal limitations
don’t apply to casual employees.
A fixed term contract can’t have an option to:
Read this statement to find out more.
Ü extend or renew the contract so that the period of employment lasts
longer than 2 years, or
Contracts before 6 December 2023 Ü extend or renew the contract more than once.
These rules apply to new contracts entered into after
this date. However, fixed term contracts entered into Example: Renewal limitations
before 6 December 2023 do have to be considered
Chelsea is given a contract for 6 months which has a right for her
when considering applying the consecutive contracts
employer to extend it twice for up to 4 months each time. This contract
limitation for a new fixed term contract entered into on
breaches limitations because a fixed term contract can’t have an
or after 6 December 2023.
option or right to extend it more than once, even if the total period is
less than 2 years.
What is a fixed term contract?
You’re on a fixed term contract if you enter into a contract 3: Consecutive contract limitations
with an employer that terminates at the end of an
If the first 3 points below all apply, and one or more of the scenarios in the
identifiable period. For example, the contract ends after:
4th point applies, an employee can’t be offered a new fixed term contract.
Ü a set date or period of time, or
1. Their previous contract was also for a fixed term, and
Ü a season
2. their previous contract and the new contract are mainly for the same
Employees engaged on fixed term contracts who are work, and
engaged on a full-time or part-time basis have similar 3. there is substantial continuity in the employment relationship between
conditions and entitlements as permanent (ongoing) the previous and new contracts, and
employees. This includes leave entitlements.
4. any of the following apply:
There are 2 main differences between full-time or part-
a) the previous contract contained an option to extend that was used
time fixed term employees and permanent employees:
b) the total period of employment for both the previous and new fixed
Fixed term Permanent term contract is more than 2 years
c) the new fixed term contract contains an option to renew or extend, or
Notice of ( Not eligible if ' Generally
employment entitled to d) there was an initial contract in place (before the previous contract):
termination
finishes at the end notice of
and Ą that was for a fixed term
of the contracted termination and
redundancy Ą that was for the same or similar work, and
period redundancy
Ą where there was substantial continuity in the
( Generally ' Eligible for employment relationship.
not eligible if unfair dismissal
Unfair employment after 6 months
dismissal finishes because (12 months for Example: Consecutive contracts
of the end of the employees of a Ahmad was employed on a fixed term contract as a site engineer
contracted period small business) for a construction company. His initial contract was for the period
of 1 January 2022 to 31 December 2022. It included an option for
For more information on fixed term employment, extension, which his employer used for an additional period of one
visit fairwork.gov.au/fixed-term-employees year, making the new end date 31 December 2023. On 1 January 2024
Ahmad signed a new fixed term contract for a term of one more year
Important: for the same position.
Fixed term employees are not the same as This contract breaches the limitations for reasons including:
independent contractors (sometimes called
Ü his initial contract contained an option to extend that was used by
ABN workers or subcontractors). Independent
his employer
contractors usually negotiate their own fees and
working arrangements, have the ability to delegate Ü the total employment period is for more than 2 years, and
or subcontract work and can work for more than Ü the contract is for the same position.
one client at a time. For information on independent
contracting, visit fairwork.gov.au/contractors

Page 1 of 3 Last updated: December 2023


 Fixed Term Contract Information Statement
Employers must give this document to new fixed term employees when they start work.
See fairwork.gov.au/ftcis

What are the situations where there are no limitations on the use of fixed term contracts?
The new rules don’t apply to all employees on fixed term contracts. These are called the exceptions to the limitations. The table below
shows which fixed term contract arrangements are not covered by the new rules:
The exception Example

Vivian is a technology professional who is engaged to provide

Specialised skills for a specific task specialised technology support on a particular project. Her contract
Work only on a specific task that requires your specialised skills. is for a period of 6 months, with 3 options to extend for one month in
case of delays.

Training arrangements
A contract for a formal training arrangement made under State or Javier has started a plumbing apprenticeship and has been given a
Territory law. This is an arrangement that combines work with study 4 year fixed term contract for the duration of his apprenticeship.
for a qualification like an apprenticeship or traineeship.

Kevin is an experienced ski patroller with strong first aid skills. He

Essential work is hired by a ski resort on a 2 month contract during the ski season,
Performing essential work during a peak demand period. with the opportunity for 2 renewals of one month each depending on
ski conditions.

Emergency circumstances or temporary replacement Gerry is engaged on a fixed term contract to replace Christina who is
of an employee taking 24 months parental leave. During this time, Christina has another
Working in emergency circumstances, or if you’re replacing someone child and takes an additional 12 months leave. Gerry’s contract is
who is temporarily away. renewed for an additional 12 months to cover this leave period.

High-income employees
If your guaranteed salary is more than the high-income threshold in
the year the contract is entered into (pro rata for part-time employees Esther is hired as an IT project manager earning $240,000 per year
or employees that work for less than a year). on a 3 year fixed term contract.
Note: For information on how the high-income threshold is calculated for part-time
or part-year employees, go to fairwork.gov.au/fixed-term-employees

Positions subject to government funding

Where the employee’s position is funded by government funding Lu is engaged on a 3 year fixed term contract to work on creating a
(completely or in part), the funding is for more than 2 years and the community garden for a community organisation. The project is fully
funding is unlikely to be renewed afterwards. funded over 3 years by the local government and the funding ends at
the end of this period.
Note: This isn’t the same as working for a government agency or department on
a fixed term contract.

Governance positions
Sunita has been given a 5 year contract on the executive board of a
A contract for a governance position that is for a limited time land-management council.
(based on the rules of the corporation or association).

Award provisions Ravi is covered by an award that allows him to work contract-to-
If an award covers your employment and it allows any of the contract. The award expressly allows for multiple (more than one)
circumstances limited by the new rules. contract renewals as agreed between the employee and employer.

Additional exceptions for contracts made between 6 December 2023 and 30 June 2024
There are some additional exceptions under the Fair Work Regulations. These exceptions only apply if the contract is entered into on or after
6 December 2023 and before 1 July 2024. These exceptions are explained below.
For more information on the Fair Work Regulations visit fairwork.gov.au/fixed-term-employees

Organised sport: Some types of employees engaged by particular High performance sport (international events): Some types of
organised sporting bodies primarily to work as certain types of athletes, employees engaged by certain types of organisations to primarily directly
coaches, performance support professionals or match officials. support the administration or organisation of an international event for a
high performance sport that is not regularly held in Australia.
Live performance industry employees: Employees covered by the Live
Performance Award 2020 who enter a contract for 12 months or less. Funded by a philanthropic entity or testamentary gift or contribution:
Some employees of organisations that are funded (wholly or in part) by
Higher education employees: Employees covered by the Higher
certain philanthropic entities registered under the Australian Charities
Education Industry – Academic Staff Award 2020 or the Higher Education
and Not-for-profits Commission Act 2012 or as a result of certain types of
Industry – General Staff Award 2020.
testamentary gifts or contributions, in certain circumstances.

Page 2 of 3 Last updated: December 2023


 Fixed Term Contract Information Statement
Employers must give this document to new fixed term employees when they start work.
See fairwork.gov.au/ftcis

What happens if a contract doesn’t meet the limitations and exceptions rules?
If your fixed term contract doesn’t meet the rules, the end date in the contract will no longer apply, which means the contract won’t
automatically come to an end at the end of that time. This will not affect the validity of any other terms of your contract. If the limitations are
breached, civil penalties could apply to an individual or a company.

What happens if my employer and I disagree about whether a limitation or an exception applies to my
fixed term contract?
If you and your employer disagree about whether the limitations or exceptions apply, there are steps you can take to resolve it.

Step 1: First, you must try to resolve the disagreement with your employer by discussing the issue with them.


Step 2: If you can’t resolve it at the workplace level, you or your employer can refer your dispute to the Fair Work Commission

(the Commission). The Commission can deal with disputes about limitations and exceptions on fixed term contracts.

If the matter is referred to the Commission, they must deal with the disagreement. They can deal with the disagreement in a range of ways
including mediation or conciliation. If both parties agree, the Commission can deal with the dispute by arbitration (for example, at a hearing).
Depending on your circumstances, you may be able to have someone to support or represent you through the dispute process (which could
include a union entitled to represent you).

Evidence
In a formal proceeding (such as a hearing at the Commission), if an employer believes a fixed term contract meets the criteria of
one of the exceptions, they will have to show evidence to support that the exception applies. Examples of evidence can include
financial reports or other contracts, such as funding and commercial contracts.

Get help with conversations in the workplace

Find free online courses to help you have difficult conversations in the workplace at fairwork.gov.au/learning

Can my employer avoid following the rules?

Your employer can’t do certain things to avoid the rules. These are called the anti-avoidance protections. This includes:
Ü ending your employment or not re-employing you for a period of time
Ü employing someone else to do the same or substantially similar work instead of you, or
Ü changing the type of work or tasks that you do or changing your employment relationship.
If an employer does any of these things in order to avoid the rules, it may also be adverse action. Adverse action is where an employer takes
an unlawful action against you because you have a workplace right (which includes the fixed term contracts rules). If adverse action is found
to have occurred, civil penalties could apply. For more information, visit fairwork.gov.au/protections

Who can help?

Fair Work Commission

Fair Work Ombudsman Ü deals with disputes about a range of issues, including unfair
Ü has information and advice about pay and entitlements dismissal, bullying, sexual harassment, discrimination and
Ü provides free calculators, templates and online courses ‘adverse action’ at work
Ü helps fix workplace problems Ü approves, varies and terminates enterprise agreements
Ü enforces workplace laws and seeks penalties for breaches Ü makes, reviews and varies awards
of workplace laws. Ü issues entry permits and resolves industrial disputes
Visit fairwork.gov.au or call 13 13 94 Ü regulates registered organisations.
Visit fwc.gov.au or call 1300 799 675

Page 3 of 3 Last updated: December 2023