Expiry of Fixed Term Contracts and Unfair Dismissal

18 January 2018

Does an employer's compliance with the Fixed-term Employees Regulations mean it will have acted fairly when a decision is made not to renew a fixed-term contract?

Not necessarily, held the EAT in Royal Surrey County NHS Foundation Trust v Drzymala.

A locum consultant doctor had been employed on a series of fixed-term contracts. A permanent vacancy arose before her contract was due to expire. She was interviewed, along with another candidate, but not appointed. Subsequently she was given notice that her fixed term contract would not be extended. The employer's letter made no mention of a right of appeal or any alternative employment with the Trust.

The Claimant lodged a grievance and was eventually allowed an appeal. An appeal panel concluded that an earlier appeal would have made no substantive difference as to the outcome.

A tribunal found that her dismissal was unfair and the employer appealed. It relied in particular on its contention that it had complied with the non-discrimination regime in the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002. Therefore the employment tribunal was wrong to conclude that the employee was unfairly dismissed.

The EAT rejected this proposition. The general law on unfair dismissal applies to dismissals which arise from non-renewal of a fixed-term contract. The question of fairness of a dismissal depends in the normal way on the facts of the case and the application of the fairness test in section 98(4) of the ERA 1996.

Dismissals by non-renewal of a fixed-term contract are often potentially fair for "some other substantial reason." But they are not a special case attracting different considerations from those normally considered under section 98(4).

In this case, the tribunal was right to consider that the Claimant had been poorly treated by the employer when it failed to pursue a discussion about alternative roles and to provide the Claimant with a timely right of appeal. The finding of unfair dismissal was therefore upheld.


With thanks to Daniel Barnett’s employment law bulletin for providing a summary of this case.