If a redundant employee accepts alternative work for a fixed term, what are their rights when that fixed term comes to an end?
The expiry of a fixed-term contract constitutes a dismissal and, in most cases, the reason for dismissal will be redundancy. Therefore, an employee who has previously accepted a fixed-term contract as an alternative to redundancy will have redundancy rights on the expiry of that contract, unless there is another reason for the dismissal. Provided that they have at least two years' continuous service, they will be entitled to a statutory redundancy payment. Their continuous service for these purposes would not have been broken when they accepted the fixed-term contract as an alternative to redundancy, provided that the new contract began immediately after the old one, or after a break of no more than four weeks.
As with any redundancy dismissal, the employer must follow a fair redundancy procedure, which includes an obligation to consult with the employee and consider further alternative employment. Selection for redundancy must be fair and not made purely on the basis of the employee's fixed-term status, unless there is an objective reason for this.
An employee with at least two years' continuous service may bring a claim that the dismissal was unfair. Therefore, the employer must ensure that the expiry of the fixed-term contract amounts to a substantively and procedurally fair dismissal.