On 6 December 2023, new laws commence which will change the way that fixed-term employment contracts can be used. Here’s what you need to know to avoid litigation/ fines if you’re an employer, or an illegal termination to your employment if you’re an employee.


Since the passing of the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) (‘the Act’) on 2 December 2022, there have been various changes in the employment space. We summarised these main changes and effects in our previous article here.

In essence, the Act introduced new rights and obligations in the workplace in a range of areas, including enterprise agreements, sexual harassment, pay secrecy, anti-discrimination, flexible work requests and fixed term contracts.

Some of these changes have already come into effect in December 2022, March 2023 and June 2023, with the last amendment on fixed-term contracts to arrive on 6 December 2023.

Fixed-term contracts

Arguably, one of the most significant changes brought by the Act was the regulation of fixed-term employment contracts, which we have not seen before in Australia.

Fixed term employment contracts will now need to comply with six areas of regulation, summarised below:

Fixed Term Contract Information Statement (FTCI Statement) – Where a fixed-term contract is offered, employers are required to provide an employee with a FTCI Statement before, or as soon as practicable after, the contract is entered into. The FTCI Statement will include information on some of the changes to fixed term contracting – for example, limitations and disputes.

Fixed-term contract duration – a fixed term employment contract must not:

    • be for a fixed-term greater than two years;
    • allow more than one option for renewal of contract that results in the employee working beyond two years, or
    • be replaced by a new contract where the total duration of the contract is beyond two years.

This change creates a time restriction on employees’ contracts which previously did not exist.

Exceptions to the new changes – There are exceptions to the new laws on fixed-term contracts. Some of these exceptions include: where specialised skills are involved for a particular task, a training arrangement is in place, the work is essential during a peak demand, an absence of another employee/emergency circumstances, the employee’s salary is above the high-income threshold, it is a governance position and funded by government for a set duration not reasonably subject to renewal. The onus rests with the Employer to argue the application of any exception.

Furthermore, as on 23 November 2023, there are additional carve outs of certain industries for which the new regulations do not apply – such as: organised sport (e.g. an athlete, coach, a match official, etc.), employees covered by the Higher Education Industry Awards and philanthropic entities.

Contravention of fixed-term contracting changes – If a fixed term contract is entered into which does not comply with the new duration rules, or an FTCIF Statement is not issued, unless one of the exceptions applies the employer is likely to be in contravention of the Act. This may result in litigation, which can include the Court ordering a penalty be paid of up to $82,500 for a company. Furthermore, the contract will be deemed to not terminate at the end of the fixed-term period but automatically be treated as an ongoing employment contract.

Anti-avoidance of the changes – As a means to prevent employers circumventing the new changes, there is an anti-avoidance provision which prohibits an employer from engaging in certain conduct to try and avoid the 2 year time limit, including terminating an employee’s employment for a period then re-engaging them (so the contracts are onto back to back), replacing a fixed-term employee with a different employee for the purpose of keeping the position subject to a fixed term contract, changing the nature of the work or altering the employment relationship.

Disputes regarding the changes – Where there is a dispute about the changes, the Act requires parties to attempt to resolve the dispute at the workplace level by way of discussion. Failing successful internal discussions between the parties, a party to the dispute may be referred to the Fair Work Commission.

How can we help?

If you would like to discuss any of the above changes, such as the application of any employment contract, relevant exceptions to the new changes or the risk/action that may apply to you, please call us at Snedden Hall & Gallop and the Employment Team can advise you further.