Everyone
Permanent or fixed-term
Find out about the employment rights of a permanent employee, a fixed-term employee, or a seasonal employee.
The employment rights and responsibilities are different for:
- permanent employees
- fixed-term employees
- seasonal employees.
Permanent employees – full-time or part-time
Permanent employees are the most common type. Permanent employees have ongoing employment at the workplace and have the full set of employment rights and responsibilities. Permanent employees can be part-time or full-time.
Fixed-term employees – full-time or part-time
For a fixed-term (temporary) contract, the employment will end on a specified date or when a particular event occurs. This might be if the employee has been hired to:
- replace another employee on parental leave
- cover a seasonal peak
- complete a project
- undertake a secondment for another employer, while still being employed by the primary employer (known as a triangular employment situation).
There must be a genuine reason based on reasonable grounds for the fixed term and the employee must be told about this reason. A fixed-term agreement cannot be used instead of a probationary period to test whether the employee is right for the job.
Trials and probationary periods
Rights on a fixed-term contract
Fixed-term employees have the same employment rights and responsibilities as permanent employees, except that their job will finish at the end of the fixed term. In some cases, the annual holiday entitlement may also be paid out rather than taken as leave.
Employee rights and responsibilities
Pay-as-you-go annual holiday pay
If an employer wants to dismiss an employee on a fixed-term contract before their contract is supposed to end, they must follow the regular dismissal process, including having a legal reason for the dismissal, like serious misconduct.
Seasonal employees
Seasonal employment is a type of fixed-term employment where the employment agreement says that the work will finish at the end of the season. It’s often used in the fruit, vegetable, fishing and meat industries. For example, in a job picking apples – the fixed term is from when the apples ripen until they are all picked.
Recognised Seasonal Employer (RSE) Scheme - Immigration new Zealand(external link)
Casual employees
Casual employees work when it suits them and have most of the same rights and responsibilities as permanent employees. They are not defined in employment legislation separately, but the term is usually used to refer to a situation where an employee:
- works when required
- can turn down work and
- has no expectation of ongoing employment.
Casual employees work when it suits them and the employer. Casual employees have most of the same rights and responsibilities as permanent employees, but the way annual holidays, sick and bereavement leave apply to them is sometimes different. Some, but not all, casual employees will meet the requirements for ‘pay-as-you-go’ holiday pay.
If an employee is employed to do casual work, the arrangement must be clearly stated in the employment agreement.
Dismissing a casual employee
Each time a casual employee accepts a proposal to work certain hours, it is considered to be a continuation of their employment, even if there is a gap since the last time they worked for the employer.
If an employer decides to stop offering work, this does not count as a dismissal because the employer has no responsibility to provide work. However, if an employer sends an employee home in the middle of a shift or goes back on an agreement to provide work for a shift, then this could mean that they were dismissed.
Holiday pay
Because casual employees do not have set hours, it may not be possible to work out how they will get annual holidays. If the employee and their employer agree and the employee meets the requirements, the employee may be able to be paid an extra 8% on top of their wages or salary instead of taking annual holidays. This is sometimes called pay-as-you-go annual holiday pay. Employees can only get pay-as-you-go if they meet 1 of 2 specific situations:
- employees who are on a fixed-term agreement of less than 12 months or
- employees who work so intermittently or irregularly that it’s not possible for the employer to pay the employee 4 weeks of paid annual holidays.
Not all casual employees will meet the test for working so irregularly that it’s difficult to give them annual holidays. An employee can get pay-as-you-go holiday pay instead of paid annual leave.
Annual closedowns and holidays
Sick leave and bereavement leave
Casual employees are also entitled to sick leave and bereavement leave after 6 months of starting work with an employer if during that time they have worked:
- an average of at least 10 hours a week, and
- at least 1 hour a week or 40 hours a month.
Pay for sick, bereavement and family violence leave
Employment agreements for casual employees
A casual employment agreement must outline the details of the employee’s work hours. The agreement should make it clear:
- that there is no guarantee of work on a specific day
- that the amount of work will fluctuate
- that each time the employee accepts an offer of work it’s considered a new period of employment
- that the terms of the agreement apply to each new period of employment
- how the employer will let the employee know when there is work available
- that the employee does not have to make themselves available for work.
Casual employees versus part-time employees
Some employees who are described as ‘casual’ are part-time employees with a clear work pattern. If an employee thinks this applies to them, they should speak to their employer and ask for a new employment agreement.
Vinod begins working at a café. His employment agreement describes him as a “casual” employee. Initially, he only worked the odd shift here and there, but then he began to regularly work from 9am to 3pm on weekdays. At this point, Vinod’s employment status is changing to being a permanent part-time employee. If he was told without warning not to come into work anymore, this would possibly be an unjustified dismissal as his employer failed to follow the correct process when dismissing a permanent part-time employee. When the work became regular, the employer should have given Vinod a new employment contract for either fixed-term or permanent part-time work.