fixed-term employment
agreements &
probation or trial periods
There are extra rules employers and employees need to know for fixed-term
agreements and if they agree to an initial probationary or trial period.
Fixed-term employment
Sometimes employers and employees agree that employment will be for
a set period of time (e.g. for six months) or until a certain event occurs
(e.g. until a particular project ends) or until work is completed (e.g.
until the fruit is picked).
Employers and employees can agree to fixed-term employment where:
- there is a genuine reason for doing so (such as seasonal work, project
work, temping work, or where the fixed-term employee is filling in
for a permanent employee on leave), and
- the employer advises the employee of those reasons and how or when
the employment will end, and does so prior to employing the employee.
In other words, the employer must make these things clear to the employee
at the outset. The employer must also set out in writing, in the employment agreement, the reasons for the fixed term and how the employment will end (we provide you examples
of wording that might be included in a letter).
Failure to record the fixed term arrangement in writing means that the employer will be unable to enforce the fixed term if the employee chooses to contest it.
An employer may not employ someone on a fixed-term agreement where the
job is really a permanent one and the employer really wants to avoid
having to go through a fair disciplinary or dismissal procedure if there
are problems.
Special provisions can apply for the provision of annual holidays, sick and bereavement leave to fixed term employees. These are outlined in the holidays section of the Employment Relations Services website (www.ers.dol.govt.nz/holidays_act_2003), or you can phone 0800 20 90 20 for information.
Examples of wording to be included in fixed-term agreements
Example 1
"The position is for a fixed
term.
This is because your job will be to prune trees in the west block, and
your job will cease when all of the trees are pruned. I estimate that
this pruning job will take you and your co-workers two months from start
date on Monday 24 November 2003."
Example 2
"The position is for a fixed term.
The reason for this is that you will be covering for an existing employee
who has taken four months' leave. That employee will return to work on
26 April 2004, and will need to be brought up-to-date by you in the week
ending 7 May 2004. As a consequence, your employment will cease on 7
May 2004."
Example 3
"The position is for a fixed
term.
The reason for this is that you will be working on a project to develop
a web strategy and build a new website. The project plan for developing
this strategy and the site build is attached. Note that the project will
end on 28 November 2003. At that time, your employment will cease."
Probation or trial periods
Employers and employees may agree to an initial probationary or trial
period. This must be recorded in writing in the employment agreement.
Failure to record the probationary arrangement in writing means that the probationary period will be unenforceable if the employee chooses to contest it. If the employer thinks there are problems, the employer still needs to
follow a fair disciplinary or dismissal procedure. The employer cannot
merely tell the employee to go at the end of the trial period.
Sometimes an employer may ask job applicants to demonstrate their skills prior to making a decision on whether to employ them. Such arrangements may be permissible where the duration and tasks are limited and designed to give the employer a fair opportunity to assess the skills. Employers may not use such an arrangement to get work done without having to pay for it. More information on probationary periods is available at www.ers.govt.nz/factsheets/guide-to-probation-periods.html
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