Fixed-term contracts: Is early termination on notice lawful?

In Solidarity obo Nel RH v Paramount Aerospace Systems (Pty) Ltd (JS72/2024) [2025] ZALCJHB 423, the Labour Court revisited whether an employer may end a fixed-term contract (FTC) before its expiry by giving contractual notice. Many employers assume that simple notice is sufficient, regardless of the underlying reason for dismissal. This judgment clarifies the distinction between contractual lawfulness and fairness under the Labour Relations Act 66 of 1995 (LRA), and offers practical guidance for those engaging employees on FTCs.

22 Sep 2025 1 min read Employment Law Alert Article

At a glance

In Solidarity obo Nel RH v Paramount Aerospace Systems (Pty) Ltd (JS72/2024) [2025] ZALCJHB 423, the Labour Court revisited whether an employer may end a fixed-term contract before its expiry by giving contractual notice.
The Labour Court confirmed the general rule: a fixed-term contract may not be ended before its agreed expiry unless (i) there is a repudiation or material breach, or (ii) the contract expressly permits early termination.
In this case, the contract allowed termination on one month’s notice without limiting the grounds for doing so. Accordingly, the employer’s conduct was lawful.

15144 _Image 1 - 22 Sept

15144 _Image 2[1] - 22 Sept

The information and material published on this website is provided for general purposes only and does not constitute legal advice. We make every effort to ensure that the content is updated regularly and to offer the most current and accurate information. Please consult one of our lawyers on any specific legal problem or matter. We accept no responsibility for any loss or damage, whether direct or consequential, which may arise from reliance on the information contained in these pages. Please refer to our full terms and conditions. Copyright © 2025 Cliffe Dekker Hofmeyr. All rights reserved. For permission to reproduce an article or publication, please contact us cliffedekkerhofmeyr@cdhlegal.com.