Use a fixed-term employment contract to hire project-based or seasonal staff, with clear terms on pay and set duration until the contract’s end.
Updated July 17, 2023
Written by Josh Sainsbury | Reviewed by Brooke Davis
A fixed-term employment contract applies for a specific, short period. It is often used for seasonal or project-based workers, and employment ends unless renewed by a particular date.
Compensation is usually determined in advance and does not change until the contract term expires. Some contracts specify a total amount of compensation or set an hourly rate that applies during the fixed period of employment.
Below, you can download a fixed-term employment contract template in PDF or Word format:
A fixed-term employment contract template should include all of the following:
Follow these steps to write a fixed-term employment contract:
Your agreement should include identifying information for your business and the employee. It should include information such as:
The employment agreement should outline what your employee will do. It should describe the employee’s title, job description, and limitations. It should also include whether the job is “at will.” Some states do not permit fixed-term employment contracts at will, while many do.
Similar to a temporary employment contract, your employee is only hired for a limited period but your fixed-term contract should expressly state a date and time when employment ends. It should be clear that employment ends automatically unless you want to renew it.
If you like this option, your agreement should specify how renewal takes place.
The contract should state how you will pay your fixed-term employee, such as hourly or fixed compensation. This information should be both accurate and precise.
This section should also include whether the employee is entitled to benefits, sick, or vacation leave.
Ensure both parties sign the document. The signature area should include lines for each party’s printed name, signatures, and date.
Can a fixed-term employment contract be renewed?
Yes, a fixed-term employment contract can be renewed. If you want this option, your agreement should specify how renewal takes place.
If a fixed-term contract is continually renewed, this may raise questions about the temporary or permanent nature of the position. While there’s no fixed limit on renewals, this could be used as evidence in a legal dispute over the nature of the employment.
What happens when a fixed-term contract expires and the employee continues working?
When a fixed-term employment contract reaches its expiration date, yet the employee continues to work, it is often interpreted as an implied contract for continuous employment. In such scenarios, the courts might bestow the individual with legal protections akin to a permanent employee’s.
This essentially transforms what was once a time-limited agreement into an indefinite employment relationship, potentially terminable only with reasonable notice.
Can a fixed-term employment contract be terminated?
Terminating a fixed-term employment contract is possible before its specified end date. It’s important to note that terminating such a contract may give rise to various consequences and obligations for both the employer and the employee.
The specific conditions and requirements for termination can differ based on the relevant labor laws and the provisions outlined in the employment agreement.
Create a Fixed-Term Employment Contract here!
