A fixed-term employment contract sets a clear start and end date for employment. In Alberta, these contracts can carry serious legal consequences — especially if the employment ends early.

Many employees assume a fixed-term contract limits what they’re entitled to if they’re let go. In reality, Alberta law often provides strong protections, and employers frequently get fixed-term contracts wrong.

This page explains how fixed-term employment contracts work in Alberta — and what your rights may be.

What Is a Fixed-Term Employment Contract?

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

Common examples include:

  • One-year employment contracts
  • Maternity or parental leave replacements
  • Project-based roles with a defined end date
  • Contracts that renew annually

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

💡 For a national overview of these agreements, see our Fixed Term Contract Canada guide.

Fixed-Term vs Indefinite Employment in Alberta

The key difference is how the employment ends:

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

That distinction matters because early termination of a fixed-term contract can trigger significant compensation obligations under Alberta law.

What Happens When a Fixed-Term Contract Ends Naturally?

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.

However, problems arise when:

  • The contract rolls over repeatedly
  • The end date becomes unclear
  • The employee continues working past the stated end date
💡 In those situations, Alberta courts may treat the relationship as indefinite employment, restoring full Alberta severance pay rights.

Early Termination of a Fixed-Term Contract in Alberta

This is where many employers make costly mistakes.

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

That can include:

  • Salary for the balance of the term
  • Bonuses or commissions
  • Benefits and other compensation
⚠️ Importantly: Employees terminated early from a fixed-term contract are often not required to mitigate by finding new work unless the contract clearly and lawfully says otherwise.

Are Fixed-Term Contracts Enforceable in Alberta?

Yes — but only if they are drafted correctly.

Fixed-term contracts in Alberta are often challenged because:

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

Rolling or Repeated Fixed-Term Contracts

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

This strategy often fails.

Alberta courts look at:

  • Length of service across multiple contracts
  • Whether the role was truly temporary
  • Whether the employee reasonably expected continued work
💡 In many cases, repeated fixed-term contracts are treated as indefinite employment, restoring severance rights.

Can a Fixed-Term Contract Limit Severance in Alberta?

Sometimes — but only if the contract:

  • Clearly addresses early termination
  • Complies with Alberta employment standards
  • Is unambiguous and properly drafted

Many contracts attempt to cap compensation but do so incorrectly, making the limitation unenforceable.

This is why legal review matters before signing — and after termination.

What Should Employees Watch For Before Signing?

Before signing a fixed-term contract in Alberta, pay close attention to:

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

A single poorly written clause can dramatically affect your rights.

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

If your fixed-term employment ends early, do not assume you’re only owed minimal pay

You may be entitled to:

  • The full remaining value of your contract
  • Additional compensation if the contract is unenforceable
  • Common law severance in certain situations

Legal advice can make a significant difference in outcome.

 

Get Advice About a Fixed-Term Employment Contract in Alberta

Fixed-term employment contracts can limit rights — or create unexpected obligations — depending on how they are drafted and applied.

Before relying on a fixed-term contract, or assuming it limits what you are owed, it’s important to understand how Alberta employment law applies to your situation.

Speaking with an employment contract lawyer in Alberta at Samfiru Tumarkin LLP can help clarify whether an agreement is enforceable and what your rights may be if it ends early.
  • No upfront fees in many cases
  • Thousands of 5-star Google reviews
  • Recognized as one of Canada’s Best Law Firms by The Globe and Mail

📞 Contact us today at 1-855-821-5900 or online to get clear advice about your situation.

⚠️ Unionized? Only your union can represent you. By law, employment lawyers can’t represent unionized employees.

Unsure About Your Rights?

Before assuming a fixed-term agreement limits your rights or obligations, get advice on how Alberta law applies.

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