The difference between on-call, fixed-term and permanent contracts in hospitality
In the hospitality industry, various types of employment contracts are used, each with its own characteristics. The most common types for hospitality workers are on-call contracts, fixed-term contracts, and permanent contracts. It’s important for employees to understand what these contracts involve and how they affect your job security and income stability. In this article, we clearly explain what each contract type entails, give real-life hospitality examples to illustrate the differences, discuss the pros and cons for employees, outline relevant legislation and rights (such as sick pay and notice periods), and provide tips on choosing or negotiating a contract.
On-call contracts in hospitality
An on-call contract is an employment agreement without a guaranteed number of hours. You only work when your employer asks you to. This type of contract is widely used in hospitality due to fluctuating demand. You may know it as a zero-hours contract (no guaranteed hours) or a min-max contract (a minimum and maximum number of hours per week/month).
Example: On-call contracts are popular in restaurants and cafés. An employer might call in a dishwasher to replace a sick colleague or ask a waiter to help out during a busy weekend.
Key features and legal rules:
No guaranteed hours: You’re only paid for the hours you actually work. The hospitality collective labour agreement (CLA) excludes continued payment if there’s no work.
Notice period for shifts: Must be at least 24 hours in advance. If cancelled later, you’re entitled to wages for the scheduled hours.
Minimum of 3 hours’ pay per shift.
Sick leave: Paid only for scheduled hours. In min-max contracts, you’re entitled to sick pay based on the minimum agreed hours.
After 12 months: The employer must offer a fixed-hour contract based on your average hours over the past year (“conversion rule”).
Presumed work hours: If you’ve worked an average of, say, 18 hours a week for 3 months, it is presumed these are your standard working hours.
Pros for employees:
Great flexibility in working hours
Easy to combine with studies or another job
Easier to find work
Varied tasks and environments
Short notice period
Cons for employees:
No guaranteed income
Less job and income security
Unpredictable schedules
Less connection with the team/company
Limited career progression
Fixed-term contracts in hospitality
A fixed-term contract is an employment agreement with a predetermined end date or duration. This could be a specific calendar date (e.g. until 31 December 2025) or a time frame linked to a specific event (e.g. for the terrace season or a project).
Example: A hotel in Scheveningen may hire someone from April to September for the summer season. A restaurant might hire a new employee for one year to assess performance before offering a permanent position.
Key features and legal rules:
Ends automatically: The contract ends without needing termination.
Notice of non-renewal: For contracts of 6+ months, the employer must inform you at least one month before the end date whether the contract will be renewed.
Chain rule (ketenregeling): A maximum of 3 fixed-term contracts in 3 years. After that, you are entitled to a permanent contract. The hospitality CLA may allow shorter breaks between contracts (e.g. 3 months).
Early termination: Only possible if explicitly agreed in writing.
Trial period: Only allowed for contracts longer than 6 months. Max 1 month (or 2 months for contracts ≥2 years).
Sick leave: At least 70% of your wages must be paid during illness. In the CLA, this is often 95% in the first year.
Transition compensation: You’re entitled to severance pay if your contract is not renewed.
Pros:
Trial period to get to know each other
Mid-term flexibility
Ends without complex procedures
Opportunity for a permanent contract
Cons:
Uncertainty about the future
Harder to get a mortgage or loan
No long-term job relationship
Limited termination options for employees
Short (or no) probationary period
Higher unemployment insurance contributions
In principle, as a temporary employee, you’re entitled to the same employment conditions as permanent staff. You may not be paid less or receive fewer benefits such as bonuses or holiday leave. Don’t settle for less simply because the job is temporary.
Permanent contracts in hospitality
A permanent contract is an employment agreement without an end date. It continues until either the employee resigns or the employer terminates the contract through proper legal channels. People often refer to this as a permanent position or indefinite contract. Many hospitality workers ultimately strive for this type of contract due to the stability it offers.
Example: After successfully completing several fixed-term contracts, a restaurant may offer you a permanent position as a full-time chef or restaurant manager.
Legal rules:
No end date: Ends only with resignation, dismissal procedures, or retirement.
Dismissal protection: You can only be dismissed for valid reasons through official procedures (e.g. labour office or court).
Notice period: Usually one month for the employee; depends on length of service for the employer.
Sick leave: Wages must be paid for up to two years (70% by law, 95% in year one per CLA).
Secondary benefits: Often better than for temporary staff (e.g. pension, training, extra leave).
Pros:
Job security and steady income
More rights and better conditions (e.g. pension)
Easier to take on major financial commitments (like a mortgage)
Employer invests in your development
Stability and peace of mind in personal life
Cons:
Less flexibility to switch jobs quickly
More formal obligations when resigning
Higher expectations and responsibilities
Less variety (if that’s important to you)
Overall, most employees view a permanent contract positively because of the stability it brings. The drawbacks are usually minor compared to the benefits. However, your ideal contract depends on your personal preferences and situation.
Tips for hospitality employees when choosing or negotiating a contract
1. Choose what fits you best
Think about your needs. Do you want security (for rent, mortgage, family)? Then a fixed or permanent contract with guaranteed hours is ideal. Prefer flexibility and freedom? An on-call or min-max contract may suit you better.
2. Know your rights
After three fixed-term contracts (or three years), you’re entitled to a permanent contract. Worked 12+ months on an on-call basis? Your employer must offer fixed hours. You’re also entitled to at least three hours’ pay per call. Know these rules so you can negotiate with confidence.
3. Negotiate for security
Offered an on-call contract but want more stability? Discuss the possibility of a min-max contract. For fixed or permanent contracts, negotiate the probation period, termination clauses or growth opportunities. Don’t be afraid to ask, in hospitality, good staff is valuable.
4. Read your contract carefully
Check details like the end date, trial period, non-compete clauses or on-call rules. Ask questions if something is unclear. Union websites or legal help desks often have useful checklists.
5. Speak up in time
Want more certainty? Raise this during performance reviews or contract renewals. Be specific: “I’d like to work 24 hours per week.”
6. Ask for advice if in doubt
Not sure about your contract? Get advice from a union, legal help desk, legal expenses insurer or lawyer. They can help explain clauses or point out your rights – especially wise with long-term contracts.
In conclusion: Each contract type has its pros and cons. In hospitality, where demand fluctuates, on-call and temporary contracts are common. But remember: as an employee, you have rights, and rules exist to prevent long-term insecurity. Hopefully, this explanation helps you better understand what to expect with each type of contract. Good luck in hospitality and make sure you choose (or negotiate) a contract that fits your needs!
