Fixed-Term Employment Contracts in BC

A fixed-term employment contract sets specific start and end date for employment.

In British Columbia, fixed-term contracts can create serious risks for employers — and important rights for employees, especially when employment ends early or the contract is poorly drafted.

Many employees assume a fixed-term contract limits what they’re entitled to. In reality, BC law often says otherwise.

What Is a Fixed-Term Employment Contract?

A fixed-term employment contract is an agreement where employment ends on a defined date or after a set period of time.

Common examples include:

• One-year or multi-year contracts
• Temporary replacement roles
• Project-based employment
• Contracts tied to funding or seasonal work

Unlike indefinite employment, fixed-term contracts do not continue automatically unless renewed or extended.

Fixed-Term vs Indefinite Employment in BC

The key difference is how the employment ends.

• Indefinite employment continues until either party terminates it
• Fixed-term employment ends on a specific date — unless it ends early

That distinction matters because early termination of a fixed-term contract in BC can trigger significant compensation obligations.

What Happens When a Fixed-Term Contract Ends on Its End Date?

If a fixed-term contract:

• Reaches its stated end date, and
• Is not renewed or extended,

the employment typically ends without severance, provided the contract is properly drafted and followed.

Problems arise when:

• The employee keeps working past the end date
• The contract renews automatically or informally
• The end date becomes unclear

Early Termination of a Fixed-Term Contract in BC

This is where fixed-term contracts matter most.

If an employer ends a fixed-term contract early, BC courts often require the employer to pay the employee the full value of the remaining contract term.

That can include:

• Remaining salary
• Bonuses or commissions
• Benefits and other compensation

Are Fixed-Term Contracts Enforceable in BC?

Yes — but only if they are clearly and lawfully drafted

Fixed-term contracts are often challenged because:

• Termination clauses in BC violate the Employment Standards Act
• Early termination language is unclear or missing
• Renewal provisions create ambiguity
• The contract conflicts with statutory minimums

If a fixed-term contract is found to be unenforceable, an employee is likely entitled to common law severance, just like an indefinite employee.

Repeated or Rolling Fixed-Term Contracts

Employers sometimes use back-to-back fixed-term contracts to avoid severance obligations.

BC courts look closely at:

• The total length of service
• Whether the role was truly temporary
• Whether the employee reasonably expected continued work

Can a Fixed-Term Contract Limit Severance in BC?

Only in limited circumstances.

A fixed-term contract may limit severance only if:

• The termination language is clear and enforceable
• The contract meets BC employment standards
• The employer follows the contract exactly

Many contracts attempt to limit compensation but fail due to poor drafting.

What Employees Should Review Before Signing

Before signing a fixed-term contract in BC, review:

• Early termination language
• Renewal or rollover clauses
• Bonus and commission treatment
• Benefit continuation
• Any clause limiting notice or pay

Small wording issues can lead to large financial consequences.

What to Do If You’re Terminated From a Fixed-Term Contract in BC

If your fixed-term employment ends early:

• Do not assume you’re only owed minimal pay
• Do not accept a severance offer without review
• Do not rely solely on HR explanations

You may be entitled to the full remaining value of your contract or more.

Get Advice From a Lawyer

Fixed-term employment contracts are one of the most misunderstood areas of BC employment law.

Before signing — or after termination — get clear advice on your rights.

Speaking with an employment contract lawyer in BC can help clarify whether an agreement is enforceable and what your rights may be if it ends early.