Fixed Term Agreements New Zealand

Fixed Term Agreements in New Zealand: What You Need to Know

In New Zealand, fixed term agreements (FTA) are a popular type of employment agreement. As the name suggests, an FTA is a contract between an employer and an employee for a fixed period of time. These agreements provide both parties with a clear understanding of the terms and conditions of employment, including the start and end dates, job description, salary, and benefits.

If you are considering a fixed term agreement in New Zealand, there are a few key things you need to know.

1. Fixed term agreements must have a genuine reason

According to New Zealand employment law, an FTA must be based on a genuine reason, such as a temporary increase in workload or a specific project. The agreement must also state the reason for the fixed term, and the reason must be related to the genuine business need.

2. Salary and benefits must be fair

Under New Zealand law, employers must offer fixed term employees the same salary and benefits as permanent employees who perform similar duties. This includes entitlements for leave, sick pay, and public holidays. FTA employees also have the right to join a union and receive equal treatment to permanent employees in terms of employment rights.

3. Renewal of FTA agreements

FTAs can be renewed, but only if there is still a genuine business need for the fixed term employment. If the reason for the FTA is no longer valid, it may be deemed to be a permanent contract, and the employee may be entitled to full employment rights.

4. Termination of FTA agreements

An FTA will come to an end on the agreed date, and the employee will not have a right to ongoing employment with the employer. However, if the employee is dismissed before the end of the fixed term, they may be entitled to compensation for any loss of income they suffer as a result.

5. Rights of FTA employees

FTA employees have the same rights as permanent employees in terms of health and safety, equal pay, and minimum wage rates. They also have the right to request flexible working arrangements, and to raise personal grievances against their employer if they feel their rights have been breached.

In summary, fixed term agreements can be a useful tool for employers who have a temporary need for extra staff. However, it is important to ensure that the FTA is based on a genuine business need, and that the terms and conditions of employment are fair and in compliance with New Zealand employment law. If you are considering an FTA in New Zealand, it is advisable to seek legal advice to ensure that you are meeting your obligations as an employer.