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Changes to fixed term contracts

23 March 2022

The Fair Work Amendment (Secure Jobs, Better Pay) Act 2022 will introduce changes to the Fair Work Act which will limit both the length and number of fixed term contracts an employer may offer to an employee to perform essentially the same work. The changes come into effect on 7 December 2023, but we have seen several enquiries about this issue from not-for-profits in recent months. 

What are the key changes?

The key elements are, unless an exception applies, that from 7 December 2023:

  • an employer may not offer an employee, or prospective employee, a fixed term contract for a period longer than two years, or that can be extended, or renewed so that the term of the contract is greater than two years.
  • an employee may not extend or renew a fixed term contract that started before 7 December 2023 so that the total term would be greater than two years.

Exceptions will apply and notably include but are not limited to:

  • a fixed term contract linked to government and other proscribed – but not yet defined – funding that extends for a period greater than two years and has no reasonable prospect of renewal,
  • training arrangements,
  • a worker performing only a distinct and identifiable task requiring specialist skills, and
  • peak or temporary emergency demand.

How can your organisation stay up to date?

Our understanding of these changes to the Fair Work Act is evolving rapidly, but it is something boards and management of not-for-profits should be aware of in developing future facing workforce strategies.

To find out more, join our upcoming webinar on 23 May 2023 with a guest presenter from Lander & Rogers’ specialist workplace law team where we’ll unpack changes to fixed term contracts and other key reforms affecting the not-for-profit sector.