Can employees on fixed-term employment contracts be treated differently from colleagues who have permanent employment contracts in Gibraltar?

Chris Brunt is a Gibraltar employment lawyer, a Barrister and Acting Solicitor who will consider all unfair dismissal cases on a no win no fee” basis”

To answer these and other questions we will be referring to Gibraltar legislation, namely,  The Fixed-Term and Part-Time Employees (Prevention of Less Favourable Treatment) Regulations 2003 to answer the question, what is a fixed-term employment contract under Gibraltar law and how does it differ from a permanent contract of employment?

Are you considered a fixed-term or permanent employee?

It is important also to appreciate at the outset that fixed-term employees in Gibraltar who have been continuously employed for four years or more on a series of successive fixed-term contracts will automatically be treated as permanent employees, see section 8(2) of the Fixed-Term and Part-Time Employees (Prevention of Less Favourable Treatment) Regulations 2003. (The Fixed Term Regulations) unless the continued use of a fixed-term contract can be objectively justified by the employer (See section 8(3) of Gibraltar’s Fixed-Term and Part-Time Employees (Prevention of Less Favourable Treatment) Regulations 2003, (The Fixed Term Regulations)

Can fixed-term employees be treated less favourably than permanent employees?

Before we answer the question as to whether Gibraltar employees on fixed-term contracts can be treated differently, or less favourably than permanent employees, let us consider why employers might offer a worker a fixed-term contract. Fixed-term contracts are useful when an employer requires certainty and a measure of flexibility, for instance, to meet absence cover or to deal with short-term business demands. Fixed-term employment contracts therefore will usually expire at the end of a project without the need for notice. However, it should be noted that some fixed-term employment contracts do provide for early termination on notice before the end of the fixed term. Workers on Fixed term contracts however are protected by Gibraltar law by the Fixed-Term and Part-Time Employees (Prevention of Less Favourable Treatment) Regulations 2003 (Fixed Term Regulations). This legislation was made to ensure that employees on fixed-term contracts are treated no less favourably than comparable permanent employees. (See section 3(1) of the Regulations).

This means that employers should not refuse fixed-term employees the benefits that they provide to permanent employees, so, for example, employers should not refuse to provide fixed-term employees with access to any pension or other benefits schemes as to do so would be unlawful unless the employer can objectively justify the difference in treatment. ‘Objective Justification’ is provided for in section 3(3)(b) of the Fixed-Term and Part-Time Employees (Prevention of Less Favourable Treatment) Regulations 2003 (The Fixed Term Regulations) and allows employers to argue that there is a legitimate reason and which is proportionate as to why ‘fixed term’ and ‘part-time’ employees should not be treated the same as comparable permanent employees.

The expiry of a fixed-term contract is a dismissal and can be potentially unfair.

It is important for employees and employers alike to realise that the expiry of a fixed-term contract is treated as a dismissal (for unfair dismissal purposes), that is, it has the potential to be unfair and, subject to the unfair dismissal regime contained in section 59 of Gibraltar’s Employment Act.

This being so an employer will need to show that there is a fair reason for not renewing the contract. Fixed-term employees, like other employees, have the right to bring an unfair dismissal claim if they have been employed for more than a year when their employment is terminated by their employer.

In a number of cases, the reason for the dismissal will be at least potentially fair. For instance, in a genuine redundancy situation (See section 65(2)(c) of the Employment Act) or for some other ‘Substantial Reason’ (See section 65(1)(b) of the Employment Act).

Gibraltar employers should always follow a fair procedure before the expiry of a fixed term. If an employee’s contract term comes to an end, it is submitted it would be ‘unfair’ for the fixed-term employee (whose contract term is coming to an end) not to be seriously considered for continual employment in the post or position they fulfilled as a fixed-term employee, this is especially so when the employer aims to engage another worker to fill the position the fixed term worker occupied. It is submitted therefore that an employer, who, at the end of a fixed term does not consider a fixed-term employee for the continuing job role is exposing the business to a risk of an unfair dismissal claim. (As long as the fixed-term employee has been employed for. more than a year of course). This means that an employer should always seriously consider the fixed-term employee for employment if their job position continues to exist, for example, including them in any interview selection process along with any other applicants.

Chris is an Employment Law Barrister and Acting Solicitor of the Supreme Court of Gibraltar who specialises in employment law.

Are you an employer who requires advice on reducing your business’s exposure to an unfair dismissal claim with respect to Fixed Term Employees?

Or are you an employee who is facing dismissal or termination of your fixed-term contract or who has been dismissed?

Contact me for a free 30-minute consultation at Phillips Barristers & Solicitors292 Main Street, Gibraltar, GX11 1AA, on 200 73900 or email me at for advice to employers on reducing your businesses exposure to an unfair dismissal claim from a fixed term contract – Or, if you are an employee, to evaluate your prospects for a claim for unfair dismissal as a fixed term employee.

All employee cases are considered on a “no win no fee” basis


All opinions are my own and are provided for information only and do not constitute legal advice. Please note that the information and any commentary on Gibraltar law contained in this article are provided free of charge for information purposes only. Every reasonable effort is made to make the information and commentary accurate and up to date, but I do not accept responsibility for its accuracy and or for any consequences of relying on it. The information and commentary do not, and are not intended to, amount to legal advice to any person on a specific case or matter. You are strongly advised to obtain specific, personal legal advice about your case or matter and not to rely on the information or comments on this site

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