THE LAW BEHIND THE HUSTLE LABOUR LAW SERIES — PART 4 Fixed-Term vs. Temporary Employment: The Difference Is in the Details
In everyday conversation, we often throw around terms like “temporary staff” or “contract worker” as if they mean the same thing. When it comes to the law, especially under Ghana’s Labour Act, these terms carry different weights and knowing the distinction can make all the difference in how your business protects itself and treats people fairly.
A fixed-term contract is a formal agreement where the employer and the worker agree that the employment will last for a specific period. It could be six months, one year or even tied to the duration of a project. The most important thing is that the contract has a clear start date and a definite end date. Once that period ends, the contract naturally expires unless it is renewed. There’s no need for additional notice or termination procedures unless one party wants to end it early, in which case, the terms of early termination must be clearly stated in the contract itself.
On the other hand, temporary employment is more fluid. It’s often used to fill in gaps like covering for someone on leave or meeting short-term spikes in demand. It’s not always structured with a fixed end date. It’s more task- or need-driven, and it might renew or repeat based on business flow. Section 78 of the Labour Act, 2003 defines a temporary workers as “a worker who is employed for a continuous period of not less than one month and is not a permanent worker or employed for a work that is seasonal in character”. The problem is that many employers treat temporary staff casually without documentation, assuming that the nature of the work protects them from legal responsibility. But under the law, the more consistently a temporary worker shows up, the more likely it is that the arrangement could be reclassified as something more permanent especially if it lacks a formal contract.
What makes this tricky is that both fixed-term and temporary workers are often performing the same kinds of jobs. They might sit beside each other, do the same tasks and even earn similar wages. But one may have legal clarity, benefits, and structure and the other may be walking in a legal grey area that puts your business at risk. That’s why it’s so important not to treat these categories as interchangeable. A fixed-term worker knows when their time ends. A temporary worker might not and if you’re not careful, that uncertainty can become a legal problem down the line.
If you’re hiring someone for a specific job that you know will end on a particular date, a fixed-term contract is the way to go. You’ll need to draft it properly, define expectations clearly and include details like payment, notice, duties and whether the contract can be renewed or not. If, however, you need someone temporarily but haven’t defined how long they’ll stay, it’s still your responsibility to structure the relationship. Put it in writing. Define the scope. Make it clear what happens when the need ends.
The law doesn’t just look at what you call someone. It looks at how they’ve worked, for how long and whether they’ve been treated fairly. The longer someone stays in your workspace without a clear contract, the more complicated things become if there’s ever a misunderstanding. That’s why structure isn’t just good business practice, it’s protection.
A fixed-term contract is a formal agreement where the employer and the worker agree that the employment will last for a specific period. It could be six months, one year or even tied to the duration of a project. The most important thing is that the contract has a clear start date and a definite end date. Once that period ends, the contract naturally expires unless it is renewed. There’s no need for additional notice or termination procedures unless one party wants to end it early, in which case, the terms of early termination must be clearly stated in the contract itself.
On the other hand, temporary employment is more fluid. It’s often used to fill in gaps like covering for someone on leave or meeting short-term spikes in demand. It’s not always structured with a fixed end date. It’s more task- or need-driven, and it might renew or repeat based on business flow. Section 78 of the Labour Act, 2003 defines a temporary workers as “a worker who is employed for a continuous period of not less than one month and is not a permanent worker or employed for a work that is seasonal in character”. The problem is that many employers treat temporary staff casually without documentation, assuming that the nature of the work protects them from legal responsibility. But under the law, the more consistently a temporary worker shows up, the more likely it is that the arrangement could be reclassified as something more permanent especially if it lacks a formal contract.
What makes this tricky is that both fixed-term and temporary workers are often performing the same kinds of jobs. They might sit beside each other, do the same tasks and even earn similar wages. But one may have legal clarity, benefits, and structure and the other may be walking in a legal grey area that puts your business at risk. That’s why it’s so important not to treat these categories as interchangeable. A fixed-term worker knows when their time ends. A temporary worker might not and if you’re not careful, that uncertainty can become a legal problem down the line.
If you’re hiring someone for a specific job that you know will end on a particular date, a fixed-term contract is the way to go. You’ll need to draft it properly, define expectations clearly and include details like payment, notice, duties and whether the contract can be renewed or not. If, however, you need someone temporarily but haven’t defined how long they’ll stay, it’s still your responsibility to structure the relationship. Put it in writing. Define the scope. Make it clear what happens when the need ends.
The law doesn’t just look at what you call someone. It looks at how they’ve worked, for how long and whether they’ve been treated fairly. The longer someone stays in your workspace without a clear contract, the more complicated things become if there’s ever a misunderstanding. That’s why structure isn’t just good business practice, it’s protection.
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