Types of employment:

Fixed term, casual and temporary employment

Dr. K. Kuhathasan, CEO Cenlead

Apart from permanent employment, there are other forms of employment that are widely practised.

Fixed Term Employment

Most organizations as prefer to offer a fixed term contract when it is felt that the nature of the work offered will last only for a limited period of time.

When offering a fixed term contract it is necessary to:

* State the period of Contract from (Date/Month/Year) to (Date/Month/Year)

* As far as the date of expiry of the Contract, get the following Clause. Included in the contract of employment “I agree to the cessation of my employment on...”

A fixed term contract is one under which a person is employed for a fixed period. The contract will come to an end by mutual agreement at the end of the agreed period.

When the management repeatedly gives a series of fixed term contracts to the same employee, it may be treated by an appropriate Court as a device and the employee being deemed to be a person on a permanent contract of employment. This is especially so where there is no break in service between the several contracts.

It is also desirable to omit any reference to the possibility of a renewal of the contract. Any further contracts should be new contracts and not mere extensions or renewals of the earlier one.

A Fixed Term Contract of Employment is one, which is entered into for a fixed term without any guarantee that the Contract would be renewed on the expiry of the period stipulated.

At the end of the period stipulated, the Contract automatically comes to an end.

Fixed Term employees are entitled to enjoy all benefits of the Labour Laws

Casual employment

* A casual employee has no right to expect daily or regular employment. A casual employees may report for work as and when they like and they can be employed as and when the employer pleases.

* The practice of having casual employees to substitute for absence of permanent employees is very common. However, the Termination of Employment (Special Provisions) Act gives coverage to an employee who has worked 180 days for a period of 12 months immediately preceding termination.

* Where the nature of work is of a transitory nature, it would be considered casual employment and all such workers are treated as Casual Employees. However, where such work recurs at regular intervals and forms part of the business, it may fall under temporary employment.

* Labour laws are silent on “Casual employment”. It is, therefor, necessary to treat them like any other employee. They should come under EPF and ETF coverage.

* A casual employee is one who is taken, either for work of a casual nature or on the basis of fulfilling a casual need. Several companies maintain a register of those who are registered for work, when work is available. The difference between a casual employee and other employees is that a casual employee cannot be expected to report for work daily. There is no obligation to offer work on a daily basis too.

* Most organizations also recruit them at the gate and at the end of the day, if there is work the next day as well, he could be informed that he may turn up for work the next day as well.

* Casual employees are also paid on a daily rated basis and as far as practicable, paid daily or not later than at the end of the week. Payment is also made by voucher and the signature of the employee is obtained.

* A casual employee employed on a weekly holiday should be remunerated at 1 1/2 times the normal hourly rate. His normal hours of work shall be nine hours a day inclusive of one hour for meals and he is entitled to overtime if he is called upon to work over nine hours.

* In the event the employer fails to provide work for the full day such employee shall be entitled to be remunerated on the basis that he has worked for the full day.

* All casual employees are entitled to EPF and ETF.

Temporary employment

* A temporary employee is an employee taken to fulfil a temporary need. If a vacancy is temporarily created by a permanent employee going on long leave such as maternity leave, study leave or where a special assignment has to be executed for which purpose extra employees are needed.

It is important to issue “A letter of temporary employment” to such people.

* Although the temporary employment is for a limited period, temporary employees will normally be entitled to the benefits of the labour laws.

Shop and Office Employees’ Act

It should be noted that people employed in a Shop or Office in any capacity are governed by the provisions of the Shop and Office Employees’ Act, irrespective of whether the employment is on a permanent or temporary basis.

Weekly holidays for temporary workers

* The Shop and Office Employees’ Act states that where an employee has, in any week, worked for a total period of not less than 28 hours, he would be entitled to one-and-a-half days paid weekly holiday.

This excludes overtime work.

* If the employee is paid a total weekly or monthly wage, such wage would be deemed to include the payment for the weekly holidays.

* However, where the payment is on daily rate, he will have to be paid for the weekly holidays at the same rate.

If, however, he has worked on the weekly on the weekly half holiday and had been paid the full day’s wage for the half day’s work, then he need be paid only an additional one day’s wage in respect of the weekly full holiday.

* It should be noted that the 28 hours referred to has been assessed on the basis of an eight hour working day and therefore, if the employee has worked for not less than three-and-a-half days in the week, he should be allowed the weekly holidays with remuneration.

* At the time of recruiting a temporary worker, it is necessary to define clearly the time period or the job to which the contract is limited.

* Temporary workers are not entitled for permanent positions in the organization unless the contract of service indicates.

* Temporary workers are included in the definition of ‘employee’ in the labour legislation in the country, and thus are covered by the legislation.

Seasonal workers

* There is a distinction between seasonal and Casual workers. Seasonal workers are employed during certain seasons of the year.

* There are certain industries such as the agricultural industry, where certain categories of employees are employed during one season of the year and at the end of that season their employment comes to an end.

* If such workers are engaged during the next season it will be new employment and the question of continuity of employment does not arise.

* In the event of a dispute regarding retrenchment of workers, the question as to whether such industry is of a seasonal nature or whether the work in that industry is done intermittently, shall be decided on by the Commissioner of Labour and his decision shall be final.

* In the case of seasonal workers they are also entitled to benefits under the EPF and ETF.

Part time workers

* Part-time work is a new concept adopted only in few institutions such as BPO Companies. They engage school-leavers and unemployed IT educated youth such as IT operators for a few hours in a day. Unfortunately, Labour Laws are silent on part-time workers.

* Part-time workers are paid for the total number of hours they have worked. They do not enjoy any benefits such as leave, gratuity and ETF.

* However, they are entitled to EPF. Under the EPF, part-time employees are covered and shall enjoy the benefits of EPF.

Outsourced employees

* Several institutions are at present outsourcing Accounting, human resources and other administrative function to specialised institutions established for such services.

* Although Labour Laws are silent on the terms and conditions of such employees most of such newly established institutions apply the shop and Office Act for the staff engaged by them. Major employment types at a glance

Permanent employment

* Can work continuously until retirement.

* Letter of appointment must be given.

* Can be asked to undergo a probationary period.

* If progress is unsatisfactory during probationary period, the period can be extended or service terminated.

* Even during the probationary period employees can enjoy all facilities under Labour Laws.

Temporary employment

* A temporary employee is an employee taken to fulfil a specified need. A temporary vacancy is created by a permanent employee on maternity leave, overseas leave or long sick leave or study leave.

* It is necessary to issue a letter of temporary employment.

Casual Employment

* Taken, for work of a casual nature. The difference between a casual employee and other employees is that a casual employee cannot be expected to report for work daily.

* If there is work the next day as well, he could be informed that he turns up for work the next day.

* Labour laws do not describe who is a casual employee. For purpose of EPF and ETF, there is no difference between a casual employee and others.

* Casual employees should be paid on a daily rated basis.

Fixed Term employment

* A contract issued for a fixed term creates an employment relationship and all dues should be met.

* It is necessary to get the duplicate of this fixed term contract signed by the employee, agreeing to the automatic termination of the contract, on the dates specified, without any further notice or act on the part to the company.

At the end of the period covered, the contract would end by operation of the Law.