Getting out of a fix

Alastair Currie looks at a case involving a doctor which provides useful guidance on the tricky question of fairly dismissing employees on fixed term contracts.

The Fixed-term Employees Regulations ('the Regulations') prevent the less favourable treatment of fixed-term employees, compared to permanent employees:

• as regards the terms of their contract; or
• by being subjected to any other detriment by their employer.

Fixed-term employees are entitled to be treated no less favourably than comparable permanent employees by reason of their fixed-term status. The right not to be treated less favourably includes the right to be informed of vacancies for permanent posts in the employer’s establishment. However, if any less favourable treatment takes place, it may be objectively justified.

A fixed-term employee employed under successive fixed-term contracts for four years or more must be treated as a permanent member of staff (unless the continued use of fixed-term contracts can be objectively justified).

Fixed-term employees are also covered by the general requirements of the fair dismissal regime set out in section 98 of the Employment Rights Act 1996 ('the ERA'). Accordingly, the dismissal of a fixed-term employee (including by non-renewal of their contract) must

• fall within one of the potentially fair reasons for dismissal – in these circumstances, the relevant potentially fair reason would usually be 'some other substantial reason' ('SOSR'); and
• the dismissal must also comply with the general test of fairness: whether the employer acted fairly in all the circumstances, in accordance with equity and the substantial merits of the case.

The facts

In The Royal Surrey County NHS Foundation Trust v Drzymala, the claimant, Dr Drzymala, was employed by the Royal Surrey County NHS Foundation Trust ('the Trust') as a locum consultant in Oncology, under a series of fixed-term contracts. However, when a permanent post-holder was appointed instead of her, through a competitive procedure, the Trust did not renew Dr Drzymala's last fixed term contract. When the Trust notified Dr Drzymala that her contract would not be renewed, it did not mention the possibility of an appeal, or suggest other roles which might be suitable (apart from one role as a Specialty Doctor, which was a lower grade and which Dr Drzymala rejected).

Dr Drzymala brought a successful claim for unfair dismissal. The Trust appealed, its main argument being that the dismissal was fair because it had complied with the Regulations:

• it had not subjected Drzymala to a detriment because of her fixed-term status, and
• it was only under an obligation to treat Dr Drzymala as a permanent employee once she had been employed on successive fixed-term contracts for at least four years; and
• it had complied with its duty to provide information about vacancies.

The decision

The Employment Appeal Tribunal ('the EAT') gave the Trust's argument fairly short shrift, and upheld the employment tribunal's finding of unfair dismissal.

In doing so, the EAT emphasised that when a fixed-term employee's contract is not renewed, that is a "passive" dismissal, in that it occurs by lapse of time; but there may still be a requirement for an employer to exercise their judgment – as was the case here, where the employee in question was competing for a permanent post and the employer had to decide which candidate to prefer.

The fact that the employer had complied with the Regulations did not make the dismissal necessarily fair. The EAT highlighted that the Regulations sit alongside the unfair dismissal regime, and complying with the Regulations does not have the automatic knock-on effect of making it fair to dismiss.

The EAT also considered the question of seeking alternative employment for a fixed-term employee when a contract expires. The EAT agreed with the employer on this point: that there is no general obligation on an employer to discuss alternative employment every time a fixed-term contract is due to expire; whether or not it is fair do so will depend on the facts of the case.

What does this mean for me?

Although this case does not have anything new to say about the law relating to fixed-term employees, it provides a useful reminder that complying with the Regulations will not automatically mean that a fixed-term employee will be fairly dismissed. When considering the non-renewal or early termination of a fixed-term contract, it is important to take a step back and remember that it amounts to a dismissal and must, therefore, comply with the usual general requirements for fairly dismissing employees.

For my comment on this case in the context of appointing locum doctors under the NHS (Appointment of Consultants) Regulations, please click here.

Alastair Currie is a partner in the Employment & Pensions Department at Bevan Brittan. He can be contacted on 0370 194 7893 or This email address is being protected from spambots. You need JavaScript enabled to view it..