Types Fixed-term and open-ended employment contracts: main similarities and differences

30.08.2019

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5 minutes.

Service interaction between an employer and a subordinate begins from the moment the work contract is signed. It reflects the list of functions assigned to the new team member, the regime and schedule of his work, and also indicates the period of production activity. Very often, employees who have been hired temporarily by an organization have a question about what are the differences between a fixed-term and an open-ended employment contract, and which type of document is considered more profitable. Of no less interest to them is information about whether it is possible to reissue an existing contract, making it ordinary, and on what grounds.

Differences from unlimited

A fixed-term contract is drawn up if a permanent one cannot be concluded according to the nature of the planned work. Traditionally, an unlimited time contract is drawn up, and a limited one is a rare exception. The main difference between a fixed-term employment contract and an open-ended one can be traced already in the name - a fixed-term contract is limited by its validity period, while an open-ended one is not limited to it. But there are several more features :

Employers often use temporary contracts to their advantage, for example, so as not to look for reasons in the future to fire an employee. Such actions are prohibited and may lead to negative consequences.

Transfer of a fixed-term contract to an open-ended one

The main difference between a fixed-term contract and an ordinary one is its conclusion for a limited period, which should not exceed five years. If consensus is reached between the parties, its effect can be increased. Such changes are usually made when the following situations arise.

1. The employee is pregnant and provided a medical report from the housing complex. Her employer can fire her only if the company closes. However, after giving birth, the contract is canceled and the woman loses the right to receive monthly child care benefits.
2. The temporary employee continues to replace the main one, since he did not begin to perform his duties at the appointed time.
3. The athlete was temporarily transferred from one employer to another, but decided not to return to his previous position. The new manager has the right to change the duration of the contract by extending it again for a fixed period.

A fixed-term contract can be extended if the employee did not have time to begin performing his duties within the agreed period, or the work specified in the agreement was not implemented in full.

The law also provides for the transformation of a temporary contract into a permanent one (but not vice versa), if circumstances so require. These include the following.

1. A temporary employee continues to work at the enterprise and perform his functions properly, despite the fact that his contract has expired.
2. There was a need for long-term cooperation with an employee hired for a short period.
3. The condition of urgency is no longer relevant, and the person remains in the organization further.

What is a civil law contract?

As a standard, conducting business involving the employment of individuals occurs in accordance with the Labor or Civil Codes. Therefore, along with employment contracts, there are also civil law ones.

A civil law contract is a normative act that stipulates the property interaction between the customer and the contractor. In this case, a working relationship does not arise between the parties in their usual sense, when an employee, under the supervision of an employer, performs an established labor function .

A civil contract reflects a specific service or work that the contractor agrees to perform for a fee.

Examples of such regulations are an author's contract, a contract or a paid service agreement.

Termination of an employment contract

According to Article 79 of the Labor Code of the Russian Federation, a fixed-term contract is terminated upon expiration. The employee is warned about this in writing, no less than three calendar days before dismissal. Exceptions to the rules are situations when the validity of this type of contract expires when it is concluded for the period of performance of the duties of an employee who is absent from the enterprise.

Termination of an employment contract means the end of the working relationship between the two parties. This is an employee of the enterprise and his employer. In the law you can find synonyms for this concept, for example, termination of employment relationships or dismissal of an employee. It is important that the termination of the contract occurs strictly on the grounds specified in the Labor Code of the Russian Federation. This guarantees the rights of workers. Each of them quits his job strictly on the grounds of the law. In addition to the Labor Code of the Russian Federation, the grounds for termination of employment contracts may also be contained in other laws.

Articles of the Labor Code of the Russian Federation provide a non-exhaustive list of grounds for termination of an employment contract:

• agreement of the parties (78th Art.);
• expiration of the employment contract (Article 79);
• termination of an employment contract at the initiative of the employee (Article 80);
• termination of an employment contract at the initiative of the employer (Articles 71 and 80);
• transfer of an employee to another employer at his request;
• employee refusal to work due to a change in the form of ownership of the enterprise;
• employee refusal to work due to changes in the terms of the employment contract, etc.

In practice, the safest path to dismissal is an agreement between the parties. This basis assumes that the employee is ready to terminate the employment relationship and the employer is not against doing so. In this situation, the contract is terminated within the period agreed upon by the parties, at almost any time convenient for them. An agreement to terminate an employment contract does not exclude the possibility of dismissing an employee on his own initiative, and if there are grounds for this, also on the initiative of the employer. Dismissal for other reasons can cause problems for both the employee and his employer.

Differences from civil law

Documents that seem similar at first glance have a number of differences. Let's look at them in the table:

Of the general features, only a limitation on the duration of work can be distinguished - in both cases, the date of employment and the date (or event) of completion of work can be specifically established. However, a fixed-term employment contract cannot be concluded for a period of more than 5 years, but a civil law one can.

How to convert TD to urgent

The transfer of a temporary TD to a permanent one can be carried out by agreement of management or the employee himself, as well as by decision of the competent authority. If the dismissal deadline was missed or the termination of the fixed-term employment agreement was not formalized, the enterprise specialist may not agree with the termination of the temporary labor agreement. An employee of an enterprise has the right to apply to special authorities, but must follow the procedure described in labor legislation.

Chapter 60 of the Labor Code of the Russian Federation states that a specialist has the right to demand consideration of a dispute regarding disagreement with the termination of the contract instead of transferring it to an indefinite one. The dispute is considered by a special commission on labor disputes. This commission is formed at the request of a specialist from representatives of the employer and workers. The commission has the right to side with the specialist, recognizing an urgent TD as indefinite.

The employee also has the right to apply to the Federal Labor Service (Chapter 57 of the Labor Code of the Russian Federation). You should contact the regional office at the location of the employer. The FTS, after considering the materials on the labor dispute, may conclude that there are grounds for transferring the temporary labor agreement into a permanent employment agreement.

The court remains the main defender of the interests of the worker. All the nuances of going to court and the procedure itself are described in Chapter. 60 Labor Code of the Russian Federation. According to a court decision, the employer may be required to make the temporary TD permanent.

This is important to know: Sample: fixed-term employment contract with an old-age pensioner (or unlimited)

Order of recognition and other necessary documents

Renewal of an employment agreement due to the inclusion of a term clause is possible only with the consent of the enterprise employee. To do this, you must sign an additional agreement to the TD. This additional agreement may also indicate changes in the specialist’s job responsibilities.

When drawing up an additional agreement, the following criteria must be strictly observed:

• you can sign a document changing the term of the contract only if there is an objective opportunity to transfer the specialist to a fixed-term contract;
• additional conditions should be included in the agreement regarding changes in the term, working conditions that can improve the employee’s situation (for example, an increase in pay);
• changing the deadline must necessarily be carried out within a wider range. This saves time on repeatedly re-signing the contract and prolonging the agreement.

Order to transfer an employee from a fixed-term employment contract to an open-ended one

In what cases is it possible

Employment under a fixed-term contract is permitted under certain conditions and circumstances established by the Labor Code. There are a number of restrictions on the transfer of an open-ended TD to a fixed-term one, and this reduces to a certain extent the employer’s ability to regulate labor relations with hired personnel.

All stages of the procedure (preparation, approval, certification by employee signatures) must be carried out in accordance with the rules of the Labor Code of the Russian Federation. The Labor Code does not regulate transfer to urgent TD. Typically, such a translation is not beneficial to a company specialist.

Article 57 of the Code includes mandatory requirements for the content of an employment contract. Among them is a term of imprisonment or an indefinite term. Failure to comply with this requirement may result in administrative liability for the employer (officials who incorrectly maintain labor documentation). After conducting a labor inspection, the prosecutor's office and other supervisory authorities have the right to impose penalties on the management of the enterprise if a silence is discovered about the urgency/indefiniteness of the contract.

Advantages and disadvantages

Like any employment agreement, a fixed-term employment contract has pros and cons for both parties. Let's look at the negative aspects:

For employee

When signing a limited-term contract, a citizen must remember what awaits him as a result:

• Simplified dismissal procedure. The employee is dismissed after the end of the contract period or after completing the work specified in the document.
• Shortened dismissal period. The employee is notified either 3 days before the end of work, or the day before the main employee leaves (Article 79 of the Labor Code of the Russian Federation).

Otherwise, the set of guarantees is similar to an open-ended contract - the employee also receives sick leave and vacation payments. Only compensation is not calculated for the last 12 months, but the average salary is calculated from the period from the moment of employment to the month before going on sick leave or vacation.

For the employer

The disadvantages of fixed-term contracts for the employer include:

• Pregnancy of an employee on a temporary contract. In such a situation, it will be possible to fire her before the end of her pregnancy in the only case - when the company is closed.
• If the employer does not warn the employee in time about the upcoming expiration of the contract, the cooperation automatically becomes indefinite. At the end of the contract, the manager no longer has the right to dismiss the employee.

Example. concluded with Petrov A.N. fixed-term employment contract for 2 years. Its completion date was set at May 5, 2021. However, the manager did not warn the employee in advance about the end of the contract, and Petrov continued to work. The manager only remembered his mistake on May 10, and notified the employee that the contract was being terminated due to the expiration of validity under Article 79 of the Labor Code of the Russian Federation. In response to this, Petrov stated that no warning was received 3 days before the completion of the contract, therefore, according to Article 58 of the Labor Code of the Russian Federation, the contract becomes unlimited. The manager agreed with the employee’s opinion and, in order to avoid litigation, did not fire him.

A pregnant employee, even after the expiration of the contract, has the right to write an application for continued cooperation, and the employer will have to approve it. True, only until the end of pregnancy - after giving birth, the employee quits.

Having combined all the information, we will briefly define the features of fixed-term employment contracts - both for the employee and for the employer.

Advantages:

• Providing an employee with full-time employment, albeit temporary. Work under a fixed-term contract comes with the same guarantees as an open-ended contract.
• The company does not have to expand its staff to carry out short-term work. If a permanent employee is dismissed, compensation will have to be paid, and hiring an employee for a temporary position will avoid unnecessary costs.

Flaws:

• The collaboration will inevitably end at some point.
• If the text of the document was drawn up incorrectly, the employee has a chance to convert the cooperation into an indefinite period in court. This causes great inconvenience to the manager, especially if a temporary employee was hired during the absence of the main one.

The main differences between a fixed-term and indefinite employment contract

Knowing the typical difference between both types of work contracts, it is easier to navigate when drawing up a temporary document. Typically, the differences in these agreements are characterized by several parameters:

• grounds for registration;
• content of the document;
• the procedure for conclusion and termination;
• validity period;
• peculiarities in assigning a probationary period and granting leave;
• accrual of payment for sick leave.

Otherwise, all employees, regardless of the period for which they were hired by the company, have the same rights, responsibilities, and are entitled to receive a full package of social guarantees.

Reasons for conclusion

The Labor Code of the Russian Federation contains a clear list of conditions under which management has the right to offer a candidate to enter into a work contract, the duration of which will be limited to a certain period of time. A person is hired:

1. in place of a temporarily absent employee in order to perform his production functions (example - maternity leave);
2. during industrial practice;
3. to perform work in a limited scope, requiring presence for no more than two months;
4. when sent from the Employment Center to temporary or public work;
5. when traveling abroad due to production needs;
6. for seasonal work for up to six months;
7. if the organization was created for specific purposes and for a limited period.

It is important to know! An exhaustive list of grounds is prescribed in Art. 59 Labor Code of the Russian Federation.

Contents of the agreement

A fixed-term contract contains information about the parties entering into it, that is, the organization and the candidate. It also reflects all the points that define the duties and rights of both representatives. They are established by the Labor Code of the Russian Federation or other labor legislation. This may contain individual working conditions, increased guarantees for a personal employee, if they are provided for by the Law, regulations, collective agreement or other local documentation.

The content of a temporary contract is regulated by Art. 57 Labor Code of the Russian Federation. After the adoption of Law No. 90-FZ, it is clearly divided into three parts: general information about the parties, as well as mandatory and additional conditions.

Conclusion procedure

Drawing up a temporary contract is no different from a regular contract, which does not limit the period of work in a given production. Experts point out only one nuance: the date of return to work and expiration date are specified in a separate section. The reasons for concluding the agreement should also be indicated here.

The limitation of the period during which the document will be considered valid is reflected in the organization’s order. However, such information is not entered into the work book. Writing to a line is done as usual.

Attention! At the end of the period, the contract is considered terminated and the employee is dismissed. The reason may be an agreement between the parties or their own expression of will.

Validity periods

The main difference between a fixed-term employment contract and an open-ended one is the limited period of its validity. Along with the date of termination of the relationship, it must be written down in one of the paragraphs. Here it is also necessary to reflect information about what task or scope of work a person is hired by the company to perform.

The law defines the maximum period of validity of the agreement - it is five years. If, after graduation, the employee continues to perform his official functions, he is automatically enrolled in the organization’s staff as a permanent employee.

Probation period, sick leave, vacation

Another difference between a fixed-term employment contract and an ordinary open-ended one are the features of the provision:

• test period;
• vacation period;
• accrual of appropriate payments during the period of absence due to illness or vacation.

However, such conditions are relevant only for those applicants who sign a contract for no more than two months.

1. So, when registering as a company, according to Art. 70 of the Labor Code of the Russian Federation, a trial period cannot be established for him.
2. He is given two calendar days of rest for each fully worked month. The employee has the right to continue working, but ask for monetary compensation (Article 291 of the Labor Code).
3. It is necessary to notify about the expiration of the contract term and termination of labor interaction no later than three days before the specified date. In accordance with Art. 292 this applies equally to the leader and the subordinate.
4. Upon dismissal, a conscript is not entitled to severance pay, unless such payments are provided for and reflected in local documentation.

It is important to know! Similar conditions are considered relevant for those who sign an agreement for a period of up to six months to perform seasonal work.

Grounds and procedure for termination

According to Art. 79 of the Labor Code of the Russian Federation, a fixed-term contract is terminated at the end of the period for which it was concluded. Its termination is possible on the basis of the conditions set forth in Art. 77 and 79 of the Labor Code of the Russian Federation and is carried out in accordance with a special procedure. However, the employer has the right to dismiss a temporary employee for other reasons:

• at the will of the subordinate;
• at the initiative of management;
• by mutual agreement of the parties;
• upon expiration of the contract.

If the employee is pregnant, then the contract period must be increased until the end of this period or maternity leave (if she took advantage of it). In this situation, she must confirm the fact of her situation every three months.

Pitfalls for the employer

The greatest risk lies in the correct drafting of the text of the document, because the slightest mistake can lead to the fact that the contract will be considered indefinite . It is important for the employer to remember that:

• You cannot issue several fixed-term contracts one after another with the same employee if the job function does not change.
• The text of the document always states the reasons for its preparation (Article 57 of the Labor Code of the Russian Federation) and the date when it should be completed.
• A fixed-term contract cannot be valid for more than 5 years.

If the above rules are not observed, cooperation officially becomes permanent. Dismissal of an employee if the contract is incorrectly drawn up is illegal, therefore, by court decision, he is reinstated in his position.

The most egregious cases of violation of temporary contracts may be subject to fines. Private entrepreneurs are charged a fine of up to 5,000 rubles, and companies – from 30 to 50 thousand rubles. according to clause 1 of article 5.27 of the Code of Administrative Offenses of the Russian Federation. If the employee registration procedure is repeatedly violated, the manager is removed from office for up to 3 years.

Example. a programmer was needed to perform a specific task - creating a website and promoting it. There was a vacant position on the staff, but the employer decided to enter into a fixed-term contract. The employee was hired and the contract was signed. After the work was completed efficiently, the manager announced the termination of the contract. However, the new employee, citing incorrect execution of the contract, continued to work.

Lawyers, having studied the text of the contract, found an inaccuracy: it did not indicate that after specific work was completed, cooperation would automatically terminate.
Therefore, the document was officially considered indefinite, and the new employee was right. In contact with

Types of work and duration of the employment contract

In the case where the employment relationship cannot be concluded for a long time, the employment contract is signed for a period - a fixed-term employment contract.

Let's consider the following cases:

• Temporary replacement - until the main employee returns.
• Work up to 2 months.
• Work for the season.
• Work abroad.
• Work not within the organization's profile.
• Work in an organization for a certain duration.
• Work involving employee retraining.
• In an elective position or involved in elections.
• Public Works.
• Another service.

Cases of concluding a fixed-term agreement by agreement of the parties:

• Employees joining an organization with a limited number of employees.
• Pensioners or those who are unable to work due to health reasons.
• Firms in the territory of the Far North or equivalent to them.
• Emergency prevention.
• Replacement of employees selected on the basis of a competition.
• Employees of the press, cinema, theaters, etc.
• Managers, deputies and chief accountants.
• With full-time students.
• Employees working part-time.

It is important to note that the minimum term of a fixed-term employment contract is not established by the legislation of the Russian Federation. The maximum period is 5 years. If it is concluded for a longer period, then if a controversial situation arises, such an agreement will be recognized as unlimited.