Limitations on fixed term contracts

The Fair Work Act 2009 (Cth) limits the use of fixed term contracts entered into on or after 6 December 2023.

Exceptions apply and the limitations do not apply to casual employees.

If a fixed term contract has a prohibited term, it will have no effect and penalties may be imposed on an employer. Anti-avoidance provisions prohibit employers from making changes to the timing or terms of a fixed term contract if one of the reasons for doing that includes to avoid the limitations. Employees (and prospective employees) may seek compensation orders in certain circumstances. If a party makes an application, the Fair Work Commission may assist in resolving a dispute.

Employers must give employees a Fixed Term Contract Information Statement before, or as soon as practicable after, they enter into a fixed term contract. The Fixed Term Contract Information Statement is produced by the Fair Work Ombudsman and available here. 

For more information download the resource and watch the following short explainer video with Victoria Halliday, Head of Legal & Consulting at Ai Group Workplace Lawyers:

Update:
4/03/2024: Iinformation has been added regarding changes to casual employment (that commence on 26 August 2024) as a result of the amendments to the FW Act made by the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024). This means that limitations on fixed term contracts will extend to casual employees, including casual employees engaged through fixed term contracts by higher education institutions.