Permanent vs Fixed Term Contract

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floydbloke

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#207636 6-Jan-2017 09:45

Someone I know is going through a recruitment process., they have been offered the role verbally but have not yet had any formal discussion on pay.

Initially the vacancy description implied that it’s a permanent role, but it turns out it is a 12 month fixed term contract.

What is a reasonable percentage uplift in pay rate for contract vs perm? If the salary for the permanent role was to be, say, $55,000 pa what sort of hourly rate for the ftc would offset the loss of benefits that a permy gets (I’m thinking annual leave, paid sick leave, job security/continuation after 12 months, union ‘protection’)?

Sometimes I use big words I don't always fully understand in an effort to make myself sound more photosynthesis.

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BlinkyBill

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#1699261 6-Jan-2017 10:54

Permanent and contracted roles are both governed by a contract, permanent employment contracts are often known as Employment Agreements, but are nevertheless contracts.

Permanent and Fixed-Term employment are the same thing, with the same (general) terms and conditions, and are subject to Employment Law. The only difference is one is ... for a fixed term; and the other has no term. So no reason to expect a remuneration difference between fixed and permanent, unless you negotiate something.

Fixed-terms are usually construed when a specific role is required to achieve something specific and then the need for that role ends. Fixed-term cannot be used as, for example, a 12-month trial. Here is a good overview prepared by the PSA https://www.psa.org.nz/media/news/fixed-term-contracts/ .

One thing to look out for when taking on a fixed-term employment is to make sure the contract specifies the conditions under which the emplyment ends, it is not simply the end of the term that signals the end of the employment.

Contracts though, do not allow for Employment-type benefits such as annual leave, sick leave, training/performance investment etc. These contracts are not covered by Employment Law, but are subject to Health-and-Safety and so on. In contrast to fixed-term employment, the term of the contract signals the end of the contract.

BlinkyBill

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#1699376 6-Jan-2017 14:05

frankv:
lxsw20:

Personally I wouldn't expect any extra. If you want that benefit you need to be a contractor and take all the flaws that come with that too.

Ummm... a person on a Fixed Term Contract *is* a contractor.

Ummm ... no. A person on a Fixed Term Contract is an employee. A contractor is not an employee.