Fixed-Term vs Indefinite Employment Contracts in Cyprus
At Connor Legal, we frequently advise employers and employees on the legal implications of different types of employment contracts in Cyprus. The most common contract structures are fixed-term contracts and indefinite contracts, each carrying specific rights, obligations, and strategic considerations under Cyprus employment law.
In this guide, we clarify the distinctions between the two and highlight what you need to know from a compliance and HR perspective in 2025.
What Is a Fixed-Term Employment Contract in Cyprus?
A fixed-term contract is an employment agreement that ends on a pre-agreed date or upon completion of a specific task or project.
Key Features:
- Has a defined end date or is tied to a specific objective
- Common in seasonal work, project-based roles, or maternity replacements
- Must not exceed 30 months in total through successive renewals unless objectively justified
- Automatically terminates unless renewed
Legal Framework:
Cyprus law (Law N.98(I)/2003 implementing EU Directive 1999/70/EC) limits abuse of fixed-term contracts:
- Successive contracts beyond 30 months are presumed to be indefinite, unless there are objective reasons
- Employers must ensure equal treatment for fixed-term employees compared to permanent staff in terms of pay, leave, and working conditions
What Is an Indefinite Employment Contract in Cyprus?
An indefinite contract is the default employment relationship in Cyprus. It does not have a fixed termination date and continues until lawfully terminated by either party.
Key Features:
- Offers long-term job security
- Employer must follow statutory notice periods when terminating the agreement
- Employee is entitled to full employment rights and benefits
- Termination without cause may lead to legal claims and compensation
Notice Periods:
Under the Termination of Employment Law of 1967 (Cap. 149):
- Notice periods depend on the employee’s length of service, ranging from 1 to 8 weeks
Probation Period:
Based on The Transparent and Predictable Working Conditions Law of 2023 N.25(I)/2023 (the “Law”), in force since 13/04/2023:
- The maximum probation period in Cyprus is 6 months.
Fixed-Term vs Indefinite Contracts in Cyprus: A Quick Comparison
Legal Aspect | Fixed-Term Contract | Indefinite Contract |
Duration | Set period or until task completion | Ongoing until terminated by notice |
Termination | Ends automatically or by just cause | Requires notice; protections against dismissal |
Legal Conversion | Converts to indefinite after 30 months (if no objective reason) | Not applicable |
Employee Rights | Equal to permanent employees (by law) | Full statutory benefits and protection |
Common Uses | Projects, seasonal roles, temporary cover | Standard long-term employment |
Employer Considerations: Choosing the Right Contract Type
When hiring in Cyprus, choosing between a fixed-term and an indefinite contract should align with:
- The nature and duration of the job
- Budget forecasting and HR strategy
- Regulatory compliance to avoid misclassification and fines
At Connor Legal, we guide corporate clients through contract drafting, HR audits, and regulatory checks to ensure legal compliance and risk minimisation.
How We Can Help | Employment Lawyers in Cyprus
Connor Legal provides specialist advice in all areas of employment law in Cyprus, including:
- Drafting and reviewing employment contracts
- Advising on termination and redundancy procedures
- Resolving employment disputes
- Assisting with Labour Department filings and inspections
Contact us today for a confidential consultation regarding your employment contracts or HR policies in Cyprus.
Frequently Asked Questions (FAQs)
Q: Can a fixed-term contract be terminated early in Cyprus?
Yes, but only with legal justification. Unjustified early termination may result in a claim for damages under the Termination of Employment Law.
Q: What happens if a fixed-term contract is renewed multiple times?
If renewals exceed 30 months cumulatively without objective justification, it will be legally considered an indefinite contract.
Q: Are fixed-term employees entitled to bonuses and leave?
Yes. They are entitled to the same terms and conditions as indefinite employees, unless a different treatment is objectively justified.
