Whether the employee works full-time or part-time hours, there are three main types of employment that an employer and employee can agree to - permanent, casual, and fixed term.
It is important to know which agreement is appropriate as they attract different rights and responsibilities. The three types are explained below.
Permanent employment is the most common type of employment. Permanent employment is where the employee is
entitled to be employed indefinitely. It is usually only ended if either the employee chooses to resign or the employer has justification to terminate their employment.
Fixed-term employment is used for an employment relationship that will end either at a specific time or on the occurrence of a specific event. Most importantly, a fixed-term agreement must have been created for genuine operational reasons.
Good examples of reasons for a fixed-term relationship are:
To replace an employee who is going on parental leave until he or she returns
To deal with an unusual influx in work caused by a large but temporary project
When you can reasonably foresee the work coming to an end at a certain or specific time (i.e. the end of an annual sharemilking milking agreement).
Bad examples of reasons for having a fixed term relationship are:
To fit in with the end of season, and for no other reason
Not knowing whether the work or task the employee is to do, might be completed or finished in the future
Wanting to use the fixed term as a trial period to see how the employee fits in and performs
Using the fixed term as a mechanism to annually review at the end of each season whether the farm or business needs the employee each year.
The Employment Relations Act includes a requirement that the fixed-term employment agreements must state in writing the way in which the employment will end and the reason for ending the employment in that way. Examples can include ''employment will end at the conclusion of the calving season'', and it will end ''with two weeks' written notice''.
Failure to comply with these requirements means that the fixed-term arrangement is ineffective as a way to end the employee's employment, and the employee can elect to treat the fixed-term as ineffective and insist on a permanent
It is also risky when an employer allows a fixed-term agreement to ''rollover'' past its expiry date, as the employee could argue that his/her employment has been varied by agreement to employment of an indefinite duration.
Similarly, employers should also be aware of the dangers of putting their employees on ''back to back'' fixed-term agreements. For example, a fixed-term agreement over the 2011/2012 season followed by another for the 2012/2013
season and so forth. Some cases in the Employment Relations Authority have held that these types of arrangements are in effect, just one continuous employment relationship, in which case the employee's employment is permanent.
A casual employment relationship is when an employer requires an employee on an 'as and when required' basis. The key features are:
Casual employments are used to engage an employee to work for a specific and short period of time (eg. to cover a staff member on annual leave or sick leave)
There is no continuing expectation of work on the part of either party
If there are subsequent engagements beyond the first one, each new engagement is a new employment relationship that requires a voluntary offer and acceptance.
If the term of an engagement exceeds a week or two, you should consider a fixed-term agreement instead.
Be wary of casual relationships that develop a sense of continuity or where the role involves a great deal of responsibility, such as having sole responsibility for an area of the business.
Just like fixed-term agreements, if the relationship begins to take on characteristics of permanent employment, then
the employer runs the risk that the employee has become a permanent employee.
* If you need any advice on the above matters, or how the law applies to your business, call 0800 FARMING for free independent employment law advice.