Question of the Day


• Fixed-term employment is a contract in which a company or an enterprise hires an employee for a specific period of time. In most cases, it is for a year but can be renewed after the term expires depending on the requirement. In fixed-term employment, the employee is not on the payroll of the company. Hence statement 2 is correct.

• Under the fixed-term employment contract, the payout or the payment is fixed in advance and is not altered till the term expires. Hence statement 1 is not correct.

• However, such contracts cannot be given for routine jobs. It is usually given out for jobs which are temporary.

• It cannot be used to replace existing employees, if he or she is on a long leave.

• The contract is duly signed by both the parties and is for a specified period of time. In IT companies, sometimes professionals are hired on a contractual basis to complete a specific project. They could be absorbed in the company later when the project is completed.

• There are a lot of companies in India as well who hire a person on contract for a year and make them permanent after the term expires. The company sees the potential of the person before taking him or her on the payrolls of the company. This is one decision which is taken by the management of the company.

• Like every other agreement, even a fixed-term employment contract has a provision in which the employers can terminate the contract on certain grounds before the due date. One of the prominent reasons could be the non-performance or the individual has committed a fraud which was proved when investigated. It is generally seen that workers who are under the fixed-term agreement do not get provident fund and some other benefits as compared to employees who are on the payroll of the company.

Hence Option B is correct choice.

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