Employment Contracts in Australia

1. Minimum Requirements

The most basic source of employment terms and conditions is the contract of employment. It can be in writing, for example, by letter of offer; it can be oral; or it can be evidenced by a course of practice. A contractual term may not be enforceable if the terms in the contract are less favourable to an employee than the terms prescribed by legislation, awards, or other industrial instruments.

2. Fixed-term/Open-ended Contracts

Employment contracts generally differ from a standard contract in that there is no completion or finishing date. The majority of employees are employed under an unlimited term contract. Employees employed under a fixed term or fixed task contract are not afforded all of the protections provided by the Fair Work Act. They are generally excluded from the unfair dismissal provisions of the Fair Work Act and may not be able to access statutory entitlements which exclude employees who are employed “for a specified period of time”.

3. Trial Period

The Fair Work Act does not refer to probation periods. However, an employee must have worked for the employer for at least six months before they are entitled to make a claim for unfair dismissal, and 12 months if the employer is a small business. An employment contract can include a probation period exceeding this period, provided it is reasonable.

4. Notice Period

Contractual notice periods in excess of the legislative requirements are very common in Australia, with four weeks being the most common notice period for ordinary workers. The Fair Work Act, based on a scaling system, regulates the required minimum period of notice of termination. If an employee’s continuing service has been less than one year, one week of notice is sufficient.

5. Express and Implied Terms

Whether something is an express term of the contract is determined by reference to the objective intentions of the parties. As a result, general information, for example, something mentioned in an interview, will not necessarily amount to a contractual promise, which is sufficient to become an express term of the contract. On 10 September 2014, in Commonwealth Bank of Australia v Barker [204] HCA32, the High Court of Australia held that, under common law, employment contracts do not contain an implied term of mutual trust and confidence.

For more information on these articles or any other issues involving labour and employment matters in Australia, please contact Michael Harmer, Partner at Harmers Workplace Lawyers ( at
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