Will the Contract of employment cease when the particular project ends?

As stipulated under article 10(C) of Proclamation no 377/96 an irregular work relating to permanent part of the work of an employer but performed on an irregular interval is considered to be a contract of employment for a definite period of time.


So, any employee working in a company for a specific project, the contact of employment will no longer exist as soon as the project ends. The mere fact that there are other projects administered by the company doesn’t give the employee the right to claim the contract is still valid there is also no provision that obligates the company to transfer employees from one project to the other.

A decision rendered in the Cassation bench on Oct 19, 2009 reflected the above fact. The defendants on this bench were the first to institute the claim. They claimed that their employer has unlawfully terminated their contract saying the specific project they were assigned for has ended while there were other projects running else where. So, they asked for compensation and other payments.

The court, after framing the issue whether the contract was lawfully terminated or not, heard the arguments of both parties.

It stated that though the position of the employer is as a permanent the employee, but the fact that they are carpenters shows that the nature of their work is temporary. Giving the above argument, it stated the contract was terminated lawfully.

The Federal High Court, up on appeal rejected the lower courts decision stating no specific provisions as to the type of work and the time limit were stipulated in their contract of employment. Thus it cannot be concluded the contract was terminated as per Article 10(e) of the Labour Proclamation. Hence it ordered the employer to pay 8 months of wedges and immediate return the employees to their place of work.

The Cassation bench, after analyzing the arguments of the parties came to see that the parties didn’t argue on the type and duration of work the employees were engaged in. so there was no need for the High Court to entertain this issue and since the project was for a limited time the termination of contract is lawful. So it enforced the judgment of the Federal First Instance Court.

What can be understood from this court’s decision is that since all companies have their own way of handling work affairs, they are not obligated by law to transfer employees from one site to another.

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