Fixed-term Employees Entitled to Enhanced Redundancy Rights

Contractual redundancy schemes often differentiate between permanent and fixed-term employees, in many cases excluding fixed-term employees from enhanced benefits. However, a recent employment tribunal decision suggests that this practice might be unlawful. If correct, this could have serious financial implications for public and private sector employers alike.

Background

Since 2002, fixed-term employees have had the right not to be treated less favourably than comparable permanent employees because of their fixed-term status, unless the less favourable treatment can be objectively justified. However, there has been some doubt whether the law demands equal treatment in respect of enhanced redundancy rights. Some have argued that whereas permanent employees have an expectation of continued employment, fixed-term employees frequently do not. As a result, it may be justifiable - and therefore lawful - to exclude fixedterm employees from enhanced compensation if they are made redundant