Managing and ending fixed-term contracts

Summary: for all fixed-term appointments

When a fixed-term contract is issued, it is accompanied by a contract cover letter which sets out the reasons that the contract is for a fixed term. The reason(s) should be one, or more, of the following:

1. to cover temporary staff absence, [for example, sabbatical leave, parental leave, sickness absence, secondment]
2. to provide specialist expertise or experience which is required for a specific time or for a specific project [details of project or reason for time limit to be specified]
3. to develop a product or service for which the outcome and future need is uncertain [details of, for example, the course or service which is under development to be specified]
4. the post is intended specifically to provide a time-limited period of training or development [details to be specified]
5. to work on, or provide specialist expertise or experience to, a research project which is dependent on an external research grant and for which there is no expectation that the work will continue beyond the availability of that external funding [project and grantor to be specified]
6. because the appointment is limited to the fixed period for which a valid visa or work permit has been issued

As the fixed-term contract end date approaches, unless an extension is already agreed, departments should consider whether the need for the post has ceased or diminished in the context of the original objective justification.

For example:

1. the employee was covering a post during a period of maternity leave/other absence and the substantive postholder is returning to their post
2. the employee was needed to provide some specialist expertise for a particular project, and the project no longer needs these skills, or the project is now ending
3. the employee had particular skills and experience which were required to develop and set up a new service but different skills and experience are required to manage and/or deliver the service on an ongoing basis
4. the employee was employed whilst undertaking a clinical PhD and the PhD is now complete
5. the post was to provide specialist expertise on a research project which was externally-funded for a limited time and either the project has ended or no further funding is available to continue the project, so work on the project will cease or diminish
6. The period of the individual’s visa or work permit is ending

Whilst not all of these reasons are formally ‘redundancy’, for the purposes of this guidance the University treats them all in the same manner. 

In all cases the reason for dismissal must be fair and transparent.

After due consideration, if it appears that the need for a post which is approaching its expected end date has ceased or diminished the department should consult with the affected individual, at least three months before the contract is due to end, to advise them that their post is at risk. 

An individual whose post is at risk may be offered a suitable post within their own department, if one is available, without such a post needing to be advertised.

Employees with two or more years’ service should also be offered the option of assistance with redeployment to a suitable alternative post within the University more broadly. This may include assistance with job search and being identified as a ‘priority candidate’ for advertised vacancies within other departments.

In the event that it has not been possible to either extend or renew the appointment, or redeploy the individual, a formal letter should be sent one month before the contract is due to end, confirming the expiry of the contract. If the individual has two or more years’ service, and the reason for the contract expiry is redundancy, the letter should set out the details of the redundancy payment due in the event that the contract ends without further employment within the University having been found. If the reason for the contract expiry is not redundancy, for example for a clinical research fellow where the stated reason for a fixed-term engagement was "to provide a time-limited period of training or development", and that training is completed, then no redundancy payment is due.

Important considerations

The dismissal of a fixed-term member of staff on the grounds of performance or capability – before, or at the end of, the contract – must be dealt with in the same way as for permanent staff and an appropriate capability or disciplinary process followed. The process outlined here is not appropriate in such cases, or in cases where the contract is being ended either during a probationary period, or ended prematurely for other reasons (for example due to unexpected withdrawal of funding). The process outlined here should only be followed when a member of staff is approaching an expected fixed-term contract expiry date.

The arrangements here apply equally to part-time or variable hours staff in fixed-term contracts. Where staff work to a very irregular variable hours pattern advice should be sought from your HR Business Partner regarding calculation of redundancy payments.

Information should be sent to, and consultation undertaken with, all affected employees, including those temporarily absent or on sick, family or carers' leave. In respect of a post where the post holder is pregnant, or is on, or has returned from a period of maternity/adoption leave, or a period of at least 6 continuous weeks of shared parental leave where the child(ren) was born or placed within the past 18 months, departments must consult HR Business Partners before taking any action. These postholders have enhanced protection from redundancy under legislation, and should therefore be given priority consideration for any suitable redeployment opportunities which arise during the period in which they are considered to be at risk of redundancy (typically the final 3 months of the contract during which period they are considered to be a ‘priority candidate’). Whilst every effort should be made to support redeployment, there  is no guarantee that suitable redeployment will be found: suitable alternative employment (ie where the postholder meets at least the minimum essential selection criteria for the role) may not arise during the relevant period of time.  In such cases the contract will end at its anticipated date and redundancy payments may be due.

In situations where a number of employees doing similar work have fixed-term contracts that are due to end at the same or similar times and it is probable that some, but not all, of the employees could be retained, it is essential that the department ensure that there is a fair procedure for selecting who is retained and who is made redundant. In these cases HR Business Partners should be consulted.

E64 Clinical training fellowships: When such contracts (see guidance) reach their completion date, as long as the reason for the fixed term for non-renewal is that the training has been completed the reason for employment ending is not redundancy but ‘some other substantial reason', and therefore no redundancy payment is due. Pro forma letter X6 should be used. The normal FTC process should still be followed.

Detailed process

• Fixed-term contracts: appointment, renewal and extension
• Fixed-term contracts: regular activities
• Fixed-term contracts: as end date approaches (less than 2 years’ service)
• Fixed-term contracts: as end date approaches (2 or more years’ service)