Federal court addresses what happens when fixed-term contracts aren't renewed
The Federal Court of Australia recently dealt with an employment law matter involving the definition of dismissal under the Fair Work Act 2009 (Cth) (FW Act), particularly concerning fixed-term contracts.
A professional sports official who worked under several consecutive fixed-term contracts over five years filed a claim after his employer did not renew his contract. He argued that the non-renewal amounted to dismissal and was connected to his workplace rights.
The case challenged the traditional understanding of when fixed-term employment ends and whether non-renewal could constitute dismissal under Australian employment law.
Between February 2015 and November 2020, the worker served as a professional rugby league umpire in Australia. He started his career in the United Kingdom, where he officiated over 75 Super League matches between 2011 and 2015, before the National Rugby League sponsored his skilled migration to Australia.
His employment operated under the National Rugby League (Match Officials) Agreement 2019, which specified that all full-time referees must work under maximum-term contracts of at least 12 months duration. He worked under five consecutive contracts during his tenure.
His final contract included a clear statement about its fixed-term nature: "You acknowledge and agree that [the employer] does not warrant or represent that your employment will continue beyond the Term and... it is intended that the employment relationship will end on the completion of the Term."
The court examined whether a contract allowing early termination could still qualify as a fixed-term contract under section 386(2)(a) of the FW Act. This required careful consideration of how employment relationships end.
The Full Bench of the Commission stated: "The contract of employment is fundamental to, and underpins, the employment relationship," adding that consideration must include "the field of employment in which the contract operates" and "the context in which the contract of employment and the employment relationship operated."
In June 2020, when told his contract would not be renewed, the worker filed a claim with the Fair Work Commission. The Commission found that his employment ended through contract expiry rather than dismissal.
The Court addressed a key aspect about employment contracts and expectations. They cited established principles: "As a matter of ordinary language, [the employer] does not terminate [the worker's] employment when his or her term of employment expires."
The Court emphasised that "some amorphous, innominate hope or expectation falling short of a binding promise enforceable by the courts is not sufficient" to override clear contractual terms.
The Court concluded that reliance upon abstract notions such as "shared 'contemplations'" and "expectations" would "signal a departure from orthodox legal analysis," confirming that a contract's natural expiration did not constitute dismissal under the FW Act.
