Fixed Term Employment Contracts vs Permanent Employment Contracts in South Africa

What is a Permanent Employment Contract?

A permanent employment contract endures indefinitely or at least until the date of retirement, subject to being terminated by resignation, mutual agreement or for reasons relating to misconduct, incapacity, or operational requirements of the employer.

What is a Part-Time Employment Contract?

A part-time employee differs from full time fixed term employee and permanent employee.

A part-time employee generally work less hours per week than full time employees (be they fixed term or permanent).

What is a Fixed Term Employment Contract?

A fixed-term employment contract is entered into for a ‘fixed term’ and is usually linked to a the completion of a specific task or to the availability of a job for a limited time period.

A fixed term contract of employment expires/terminates automatically on the arrival of a specific date or the occurrence of a specific event agreed to between the parties in the contract of employment.

What does "Rolling Over" mean in relation to Fixed Term Contract?

Some employers continue to renew fixed term contracts every time they expire and this is known as “rolling over” the contract. 

It is not forbidden for an employer to roll over a fixed term contract (once or at the most twice is acceptable), however, where a contract has been rolled over for the third or fourth time, a the “right of expectation” may arise. A right of expectation means that the employee has the right to expect that such a situation will continue, and their contract will be renewed. If the contract is then not renewed, and the employee is dismissed, there are strong grounds to take the employer to the CCMA on the grounds of unfair dismissal.

Terms of Employment

Irrespective of the type of contract of employment, the Basic Conditions of Employment Act (“BCEA”) provides certain mandatory minimum standards of employment which have to be adhered to which includes, inter alia, minimum leave, hours of work, maternity leave, notice periods.

If you would like to find out more information, contact our labour attorneys today. Barter McKellar’s employments lawyers have in-depth experience in employment and labour law matters.