In a recent ruling The court has made it clear that employers must respond to employees’ requests to convert their employment contract to a permanent contract in a timely and reasoned manner.
Flexible Working Act
The above ruling is based on the Flexible Working Act. This Act allows employees to request that their employer adjust their terms and conditions of employment. The Act requires employers with ten or more employees to respond to such a request in writing, stating their reasons, within one month. If an employer fails to respond within this period, the employee’s request is automatically granted.
Facts of the case
- On 20 June 2023, a sales assistant wrote to her employer asking for her fixed-term contract to be converted into a permanent contract.
- The employer did not respond until 7 July 2023, stating that her contract would end on 8 August 2023 and would not be renewed (well within the mandatory one-month response period, one might say);
- The employee subsequently lodged an application with the court to convert her employment contract to a permanent one.
Excerpt
- The court ruled that the employer had, after all, failed to respond to the employee’s request in a timely and reasoned manner, as required under the Flexible Working Act.
- Although the employer had responded within a month, the response did not meet the legal requirements. The employer’s notification that the contract would be terminated made no reference to the employee’s request for a permanent contract and did not contain a reasoned refusal.
- The employer should have responded to the request in writing, giving reasons. As this did not happen, the employee’s request was automatically granted.
- The employment contract was therefore automatically converted into a permanent contract.
Employer gets off lightly
As the employee did not take action until November 2023, her application to the court was submitted too late. Under the law, she should have submitted an application to the court within two months of her dismissal. As a result, the contract could no longer be reversed. Had the employee submitted a petition to the court before 8 October 2023, she would have been entitled to a contract of indefinite duration.
Key Lessons
- Employers must respond to requests from employees in a timely manner (within one month of the request) and provide reasons for their response.
- Failure to respond within the specified time limit will automatically result in the request being approved.