Employment Code Act: What Employers Need to Know in 2026

The Employment Code Act has undergone several refinements in recent years, and a number of provisions continue to generate practical questions for employers. We summarise the issues that most frequently arise in our advisory work.

Fixed-term contracts

The Code's treatment of fixed-term contracts, particularly the rules on renewal and the conversion to permanent status after specified periods, requires careful attention. Employers who default to rolling fixed-term contracts may find themselves with permanent employees by operation of law.

Terminal benefits

Calculation of terminal benefits remains one of the most disputed areas. Gratuity, severance pay, leave pay and notice pay each have distinct triggers and computation methods. Generic templates rarely capture the nuances.

The most expensive employment terminations are not the ones that go to court, they are the ones built on contracts that should have been redrafted three years earlier.

Practical guidance

We recommend that all employers conduct a periodic audit of their employment contract templates, staff handbooks and HR policies against current legislation. The cost of compliance is invariably less than the cost of an Industrial Relations Court claim.