Is the employer bound to 'guarantee' employment after term's expiration?
The Fair Work Commission (FWC) recently dealt with a case involving a worker's application for an unfair dismissal remedy against her employer. She claimed that the latter failed to renew her fixed-term contract after promising that it would “roll over”.
The case also looked at whether the worker's employment was terminated at the employer's initiative, a key requirement for the FWC to have jurisdiction to hear the application.
The FWC looked into contractual interpretation and the nature of the worker's employment relationship, examining the terms of her fixed-term contract and the circumstances surrounding its expiration.
Background of fixed-term case
The worker was employed as a Wellbeing Coordinator at Northern Bay College on a fixed-term contract from 20 March 2023 to 20 December 2023.
Despite the worker's claims that the terms of the agreement were not adequately explained to her, the FWC found that she was aware of the fixed-term nature of her employment by mid-2023.
The FWC examined the express terms of the contract, which clearly stated the employment relationship's commencement and end dates. The contract was found to represent a genuine agreement between the parties, with no evidence to suggest otherwise.
The FWC then considered several factors which could potentially excuse the parties from the contract's performance.
These factors included:
- misrepresentation
- mistake
- unconscionable conduct
- duress
- lack of legal capacity, and
- the contract being a sham.
The worker did not contend, and no evidence was presented, that any of these factors applied to her case.
Employer’s representations about contract
The worker claimed that the employer had made representations, both orally and in writing, that her employment would continue beyond the expiration of her contract.
However, the FWC was not persuaded by these claims, noting the lack of documentary evidence to support them.
“No documentary evidence was provided in support of the [worker’s] claim that both written (via multiple email chains) and oral representations had been made to her that she would get a ‘rollover’ contract,” the FWC said.
The worker had also applied for new roles that arose from a restructuring of the Wellbeing team but was unsuccessful in securing a position.
Was it a ‘rollover’ contract?
While the FWC acknowledged the worker's disappointment and financial concerns, it found that her subjective beliefs did not provide a legal foundation to prevent the employer from relying on the contract's terms.
The FWC concluded that the worker's employment relationship ended by the “effluxion of time upon the expiration of her fixed-term contract.”
“[The worker had] a single time-limited contract. [The terms] reflected the genuine agreement of the parties that the employment relationship would end upon [its] expiry,” it said.
Since no vitiating factors were found to be applicable, the worker's employment was not terminated at the employer's initiative.
Consequently, the worker was not terminated within the meaning of the Fair Work Act, and her application was dismissed.
