Permits & People

Fixed-Term Contract Tanzania: The Nine Categories, Renewal and Expiry

Cover: fixed-term employment contracts in Mainland Tanzania and Zanzibar under section 14(1)(b) of Cap. 366 as amended by Act No. 4 of 2025
Section 14(1)(b) decides who may hold a fixed term; Rule 4 of the Code of Good Practice decides when its end is a termination. As at 21 October 2026.
Direct answer

Who can be employed on a fixed-term contract in Tanzania? Since 14 March 2025, section 14(1)(b) of the Employment and Labour Relations Act allows a specified-period contract only for nine listed employees, such as project staff, seasonal workers, graduate trainees and non-citizens with a work permit. The contract ends on expiry without severance, but non-renewal is a termination where renewal was reasonably expected.

This guide explains the fixed term contract Tanzania rules after the Labour Laws (Amendments) Act No. 4 of 2025. It covers the nine categories, written particulars, expectation of renewal, notice, severance on expiry, early termination, probation, foreign employees and their permits, social fund contributions, Zanzibar, and a worked example in Tanzanian shillings.

Who should read this

Our guide to employment contracts and workplace policies covers the wider contract file.

What the law says: section 14 of Cap. 366 after Act No. 4 of 2025

The governing text is the Employment and Labour Relations Act, Cap. 366 R.E. 2019, as hosted by the ILO. Section 14(1) allows three forms of contract and no others:

Until March 2025, paragraph (b) read "a contract for a specified period of time for professionals and managerial cadre". The Labour Laws (Amendments) Act No. 4 of 2025 deleted that paragraph. Section 6 of the amending Act substituted a contract for a specified period "for an employee who" falls within one of nine items. The President assented on 4 March 2025, and the Act was published in the Special Gazette of 14 March 2025.

The words "professionals" and "managerial" no longer appear in section 14. A manager may hold a fixed term only if the role fits one of the nine items.

Section 6 also added section 14(3). Contracts for graduate trainees under item (ii) must follow standards and conditions to be prescribed in regulations. We found no such regulations published at the date of this guide.

The amending Act did not touch sections 15, 35, 36 or 42. It did add a new section 41A on breach of a fixed-term contract, and it rewrote the compensation ranges in section 40. Law firms reported the change at the time, including Bowmans on 28 March 2025 and Clyde & Co on 30 April 2025.

Which employees may now be on a fixed-term contract?

The nine items in the substituted section 14(1)(b) are set out below in the Act's own order. The right-hand column is our reading of how employers use each one.

ItemEmployee whoTypical use and limit
(i)is employed on account of a temporary increase in the volume of workPeak workload; the increase must not be expected to endure beyond twelve months
(ii)is a graduate employed to be trained or to gain work experience in order to be employedGraduate programmes; training must not exceed twenty-four months; regulations to follow under s.14(3)
(iii)is employed to work exclusively on a specific project with a limited or defined durationConstruction, installation, research or system projects
(iv)is a non-citizen granted a work permit for a defined durationExpatriate staff; term matched to the permit
(v)is employed to perform seasonal workHarvest, processing and tourism seasons
(vi)is employed for an official public works scheme or similar public job creation schemeGovernment and council schemes
(vii)is employed in a position funded by an external source for a limited periodDonor or grant-funded posts
(viii)has reached retirement age as per the applicable lawsRe-engaging a retiree
(ix)is employed by an employer whose business depends on acquiring tendersContractors and service firms that win work by tender

The statutory list reads as closed: paragraph (b) applies to "an employee who" meets one of the items, with no residual category. Some commentators describe the list as non-exhaustive. Until a court rules, assume that a fixed term outside the nine items will be read as a contract for an unspecified period.

Write the item and the reason into the contract, so an arbitrator sees why the term ends.

How do the three contract types compare?

PointUnspecified period, s.14(1)(a)Specified period, s.14(1)(b)Specific task, s.14(1)(c)
Who may hold itAny employeeOnly the nine items aboveAny employee where the task can be defined
How it endsNotice under s.41 with a fair reason and procedureAutomatically on the agreed expiry date (Rule 4(2), GN 42 of 2007)On completion of the task
SeveranceSeven days' basic wage per completed year, up to ten years, after twelve months' service (s.42(1), (2))Not payable on expiry (s.42(3)(c))Expiry exclusion is worded for time; confirm for task completion
Early termination by employerFair reason and procedure (s.37 and Code)Material breach can cost the remuneration for the remaining term (s.41A)Fair reason and procedure
Main riskUnfair termination claim under s.40Expectation of renewal, renewal by default, use outside the nine itemsTask drawn so loosely it never ends

What must the written particulars say?

Section 15(1) of Cap. 366 requires the employer to give written particulars when employment starts. They include the employee's details, place of recruitment, job description, date of commencement, the form and duration of the contract, place of work, hours and remuneration. A full written contract that contains them can replace a separate statement under section 15(2).

Three parts of section 15 matter most for a fixed term:

For a fixed term, add the section 14(1)(b) item, the start and end dates, the reason for the term and any renewal condition.

Older advice relies on regulation 11 of the Employment and Labour Relations (General) Regulations, GN 47 of 2017, for a minimum fixed term of twelve months. In Bank M Tanzania PLC v. Andrew Bazo Shiyo (Labour Division, 13 November 2020), the court applied that minimum to a manager on a six-month contract. How it sits beside item (i), which contemplates work lasting up to twelve months, is not settled.

When does not renewing a fixed term count as a termination?

Section 36(a)(iii) of Cap. 366 includes in "termination of employment" "a failure to renew a fixed term contract on the same or similar terms if there was a reasonable expectation of renewal". Where that expectation exists, non-renewal is a termination, and the employer must show a fair reason and a fair procedure.

The Code of Good Practice, GN 42 of 2007, adds the working rules in Rule 4. The Court of Appeal read them in Asanterabi Mkonyi v. TANESCO, Civil Appeal No. 53 of 2019, [2022] TZCA 96:

In Mkonyi, the Court adopted objective factors such as the availability of the post, the purpose of the fixed term and inconsistent conduct by the employer. It accepted that repeated rollovers can found an expectation, but dismissed the appeal because the employee had absconded.

In Suleiman Hassan Stima v. G4S Secure Solutions (28 January 2022), the Labour Division put the burden on the employee and held that previous renewal alone is not decisive.

Renewal risk checklist

SignalWhy it raises riskWhat to do
Three or more renewals on identical termsObjective basis under Rule 4(5)Review the reason for the term at each renewal and record it
Employee keeps working after the end dateRenewal by default under Rule 4(3)Diarise expiry; sign the renewal or end the work before the date
Manager said renewal was "a formality"Employer undertaking to renewBrief line managers; make renewal decisions in writing only
Post continues after the employee leavesAvailability of the post (Mkonyi factors)Record why the role ends or why it is refilled on different terms
No section 14(1)(b) item namedContract may be read as unspecifiedName the item and the reason in the contract
Non-renewal follows a complaint or pregnancyLooks like an unfair or prohibited reasonTake advice before the decision; route through an advocate if a dispute is likely
Contract shorter than twelve months for a role outside item (i)GN 47 of 2017 minimum as applied in Bank MUse twelve months or more unless an item clearly supports less

Is notice required when a fixed-term contract ends?

Not by statute. Section 41(1) sets minimum notice "if a contract of employment can be terminated on notice": seven days in the first month, then four days for daily or weekly paid staff and twenty-eight days for monthly paid staff. A fixed term ends on its date under Rule 4(2), so no notice is needed for expiry itself. In Stima, the court rejected an argument that thirty days' notice of non-renewal was owed.

Good practice still favours a short written notice of non-renewal before expiry. It rebuts any argument of renewal by default.

Notice does apply where the contract itself allows early termination on notice. Section 41(2) requires any agreed longer period to be equal for both sides, and section 41(5) allows pay in lieu. Notice may not run during statutory leave under section 41(4).

Is severance payable when a fixed-term contract expires?

No. Section 42(1) and (2) give severance of at least seven days' basic wage for each completed year of continuous service, up to ten years, where the employer terminates after twelve months' continuous service. Section 42(3)(c) excludes "an employee whose contract of service has expired or ended by reason of time", and an employee who attains retirement age.

Three points narrow the exclusion:

Expiry does not cancel other terminal pay: outstanding remuneration and accrued leave (s.44(1)), a certificate of service (s.44(2)) and transport to the place of recruitment (s.43). Our guide to employee termination in Tanzania sets out the full final pay file.

What happens if the employer ends a fixed term early?

New section 41A, added by section 13 of Act No. 4 of 2025, applies here. Where an arbitrator or the Labour Court finds "material breach of a fixed term contract" by the employer, it may order compensation "equal to the remuneration for the remaining term of the contract".

Ending a two-year contract after six months can therefore cost eighteen months' remuneration. Labour Court decisions such as Bank M already awarded pay for the unexpired period.

A fixed term can still end early for a fair reason after a fair procedure. Since 14 March 2025, compensation for unfair termination falls in bands under section 40(1)(c).

FindingCompensation rangeBasis
Unfair procedure only6 to 12 months' remunerations.40(1)(c)(i)
Unfair reason only12 to 18 months' remunerations.40(1)(c)(ii)
Unfair procedure and unfair reason12 to 20 months' remunerations.40(1)(c)(iii)
Discrimination or harassment12 to 24 months' remunerations.40(1)(c)(iv)

Some summaries print 24 months for the third band; the Act text reads twenty months. For a retrenchment of fixed-term staff before expiry, follow the consultation steps in our redundancy procedure guide.

How does probation work inside a fixed-term contract?

A fixed term can include probation under Rule 10 of GN 42 of 2007; our guide to the probation period in Tanzania covers that rule in full.

Section 35 matters more. The unfair termination Sub-Part "shall not apply to an employee with less than 6 months' employment". A twelve-month fixed term with a three-month probation therefore leaves the employee outside that Sub-Part for six months, not three.

Section 41A is not in that Sub-Part, so early termination in the first six months may still be measured against the remaining term. Treat a renewed employee as past the six-month line.

How do fixed terms work for foreign employees?

Item (iv) makes a non-citizen with a work permit "for a defined duration" eligible for a fixed term. The permit rules sit in the Non-Citizens (Employment Regulation) Act, Cap. 436, which applies to Mainland Tanzania only.

Draft the contract to end on the permit expiry date, or to continue only if a renewed permit is issued. Employing a non-citizen without a valid permit carries a fine of not less than TZS 10,000,000, or imprisonment of not less than two years, or both (F0422).

ItemAmountRegister ID and basis
Work permit Class A, investors and self-employedUSD 1,000F0413; Cap. 436 R.E. 2023 s.10(2)(a), Fifth Schedule
Work permit Class B, prescribed professionsUSD 500F0414; same basis
Work permit Class C, other professionsUSD 1,000F0415; same basis
Renewal or change of classFull class fee again; file at least 60 days before expiryNEW-04-36; Cap. 436 s.12(7)
Residence permit Class B-1, directUSD 2,000 (EAC USD 500)F0406; Immigration Act Cap. 54 R.E. 2023 s.50(1)(j)

Our guide to work permit renewal in Tanzania covers the renewal file and the eight-year limit.

Do social fund contributions change for fixed-term staff?

No. A fixed-term employee is an employee, and the same contributions apply from the first payroll. The figures below are from the Zatra fee register at 26 September 2026.

ContributionRateRegister ID and basis
NSSF, private sector20% of wage; employee share not above 10%F0279; NSSF Act Cap. 50 s.12
Workers Compensation Fund0.5% of gross monthly earnings, employer onlyF0281; Workers Compensation Act Cap. 263
Skills and Development Levy3.5% of gross emoluments, employers with 10 or more employees, by the 7th of the following monthF0276; Cap. 82 s.14
NSSF late payment penalty5% of the unpaid amount for each month or partF0446; Cap. 50 s.14(1)

PAYE applies under the Income Tax Act whatever the contract type; our guide to PAYE and net salary has the bands. For pension arithmetic see NSSF and PSSSF contributions.

What is the position in Zanzibar?

Labour is not a Union matter. Cap. 366 and Cap. 436 apply to the Mainland, and Zanzibar employers follow the Employment Act No. 11 of 2005, published in Legal Supplement No. 6115 of 7 October 2005. We read the published 2005 text; we found no consolidated version showing later amendments.

PointMainlandZanzibar
StatuteCap. 366 R.E. 2019, as amended by Act No. 4 of 2025Employment Act No. 11 of 2005
Contract typesUnspecified, specified period (nine items), specific taskPermanent, temporary, part-time and daily paid (s.44)
Length of a fixed or temporary termNo statutory maximum; item limits of 12 and 24 monthsTemporary service between six months and three years (s.44(b)(i))
FormWritten particulars (s.15)Written contracts attested by a labour officer (s.46(1)); oral contracts up to six months (s.45(1))
Ending on expiryAutomatic (Rule 4(2)); no noticeEnds on expiry (s.52(1)(a)(ii)); no notice (s.54(1)(b))
Foreign employeesCap. 436 permit, 24 months, eight-year capLabour Commissioner permit, six to twelve months, renewable up to four years (s.37)
DisputesCMA, then the Labour CourtLabour officer, then the Industrial Court (s.21(3))

Confirm severance and unfair termination rules with the Zanzibar Labour Commissioner. Our guide to the Zanzibar work permit covers foreign staff on the islands.

Worked example: a 24-month project engineer in Dar es Salaam

A contractor with 40 staff wins a 24-month substation project. It hires a Tanzanian engineer under section 14(1)(b)(iii) from 1 November 2026 to 31 October 2028. Basic wage is TZS 4,500,000 a month and housing allowance TZS 500,000, so gross pay is TZS 5,000,000.

Step 1: monthly employer cost of contributions. We assume the 10/10 NSSF split on gross pay. Confirm the wage base with NSSF.

LineComputationTZS a month
NSSF employer share (F0279)10% x 5,000,000500,000
WCF (F0281)0.5% x 5,000,00025,000
SDL (F0276)3.5% x 5,000,000175,000
Total on-costOver 24 months: 700,000 x 24 = 16,800,000700,000

Step 2: clean expiry. The project ends on time and the engineer is not renewed. Written notice of non-renewal goes out on 1 October 2028. Severance is nil under section 42(3)(c). Say ten days of leave are untaken. On a daily basic wage of TZS 150,000 (4,500,000 divided by 30), leave pay is TZS 1,500,000. The engineer also receives the last month's pay and a certificate of service.

Step 3: early termination without a fair reason. The client delays the project and the contractor ends the contract on 31 January 2028, after 15 months. If an arbitrator finds material breach, section 41A allows remuneration for the remaining nine months: 9 x 5,000,000 = TZS 45,000,000. We have used gross pay as "remuneration"; the arbitrator decides the measure.

Step 4: the expectation trap. Suppose the engineer is instead kept on three successive one-year contracts and told renewal is routine. Non-renewal could then be a termination under section 36(a)(iii). A finding of unfair reason would fall in the 12 to 18 month band: at least 12 x 5,000,000 = TZS 60,000,000.

Step 5: a foreign engineer. If the engineer were a non-citizen on a Class C work permit, the permit costs USD 1,000 (F0415) and runs 24 months. A residence permit B-1 adds USD 2,000 (F0406). Total government fees are USD 3,000, kept separate from TZS figures. The contract should end on the permit expiry date unless a renewal is filed at least 60 days before it.

Illustrative arithmetic only; the divisor of 30 is a convention, not a statutory rule.

What to do now

  1. Audit current contracts. List every fixed-term employee and the section 14(1)(b) item that supports the term.
  2. Convert or justify. Where no item fits, treat the contract as unspecified and take advice before the next expiry.
  3. Update templates. Remove "professional and managerial" wording and add the item, the reason and the renewal condition.
  4. Diarise expiry dates. Set reminders 60 days ahead, and 90 days ahead for non-citizens, so the decision is made in time.
  5. Decide renewals in writing. Record the reason for each renewal or non-renewal and send written notice before expiry.
  6. Stop work on the end date. Do not let an employee work past expiry without a signed renewal.
  7. Match permits to contracts. Align each expatriate's term with the work permit and file renewal at least 60 days before expiry.
  8. Prepare the exit file. Compute final pay, accrued leave and transport, and issue the certificate of service.

Key dates

WhenWhatSource
24 January 2007Code of Good Practice, GN 42 of 2007, adopted (Rule 4 on fixed terms)ILO NATLEX record
24 February 2017Employment and Labour Relations (General) Regulations, GN 47 of 2017GN 47 of 2017
4 March 2025Assent to the Labour Laws (Amendments) Act No. 4 of 2025Act No. 4 of 2025
14 March 2025Act published; nine fixed-term items, s.41A and new s.40 bands applySpecial Gazette No. 4, Vol. 106
At least 60 days before permit expiryWork permit renewal filed with the Labour CommissionerCap. 436 s.12(7)
Within 30 days of terminationReferral of an unfair termination dispute to the CMAGN 64 of 2007 Rule 10(1)
Within 60 daysReferral of other disputes, such as unpaid terminal benefitsGN 64 of 2007 Rule 10(2)
Five years after employment endsKeep the written particularsCap. 366 s.15(5)

The CMA time limits are quoted from Jumanne Bakari Membe v. Lake Oil Ltd, Labour Division. Our guide to labour disputes at the CMA explains the process.

How Zatra helps

Zatra audits fixed-term contracts against the nine items, rewrites templates and keeps an expiry calendar. We prepare non-renewal letters and final pay, and align expatriate contracts with permits.

Our HR consulting service leads the work, with the permits team on non-citizen files.

Costs come in two separate buckets. Government charges, such as work permit and residence permit fees, are paid at the official rate against the authority's control number. Zatra's professional fee is quoted on its own line and never mixed with them. Zatra prepares and files, but does not decide or guarantee any authority's outcome. Representation at the CMA or the Labour Court, disputes, prosecution and formal legal opinions go to an advocate.

Sources and status

Accurate as at 21 October 2026.

Figures to confirm before you act

This article is general information based on official sources available at the date of publication. It is not legal, tax or financial advice. Laws and notices change. Verify with the issuing authority or consult Zatra before acting.

Frequently asked questions

Can a professional or manager still be hired on a fixed-term contract?

Only if the role fits one of the nine items, for example a funded project, a tender-dependent business or a non-citizen with a work permit. Seniority alone stopped being a ground on 14 March 2025. A manager hired for an ongoing role should be on a contract for an unspecified period.

Can a fixed-term contract be renewed more than once?

The Act sets no limit on the number of renewals on the Mainland. Each renewal adds weight to a later claim of reasonable expectation, so record the reason each time. In Zanzibar, temporary service runs between six months and three years under section 44 of the 2005 Act.

Does a fixed-term employee earn annual leave?

Yes. Leave rights under Cap. 366 apply to every employee covered by the Act, whatever the contract type. Untaken leave accrued by the end date is paid out under section 44(1). Plan leave inside the term so the balance at expiry is small.

Can the employee resign before a fixed term ends?

The Act does not address resignation from a fixed term in detail. Where the contract allows termination on notice, the notice must be equal for both sides under section 41(2). Where it does not, early resignation may be a breach, and the employer's remedy is a matter for advice.

Is a short contract for a holiday or harvest season lawful?

Seasonal work is item (v) of section 14(1)(b), so a seasonal fixed term is lawful. State the season and the work in the contract. Bank M applied a twelve-month minimum to a manager in 2020, and its effect on seasonal terms after the 2025 amendment is not settled.

Can a retired employee be brought back on a fixed term?

Yes. Item (viii) covers an employee who has reached retirement age under the applicable laws. Severance is not payable at retirement under section 42(3)(c), and the new fixed term should state its own dates, duties and pay.

Must a fixed-term contract be registered or attested on the Mainland?

No registration is required on the Mainland; written particulars under section 15 are the record. In Zanzibar, section 46(1) of the 2005 Act requires written contracts to be attested by a labour officer, and section 57 requires contracts with foreigners to be written and attested.

Where does an employee challenge non-renewal?

On the Mainland, at the Commission for Mediation and Arbitration within 30 days of the termination. Revision of an award lies to the Labour Division of the High Court. Employers facing a referral should brief an advocate early, because the record is set at mediation.

Sources & regulators

Verify before filing: Rates, forms and thresholds move by Finance Act, Government Notice and portal revision. Confirm the live schedule on the mandate-holder portal before you budget or submit. Law-firm alerts and Big Four notes are discovery only.

Brief the desk

This Insights page is orientation. HR consulting is the commercial desk for the same facts. Zatra’s fee stays on its own line, separate from government, bank and regulator charges. Approvals are not guaranteed.

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Disclaimer

This article is informational orientation. It is not legal, tax or investment advice and not a government decision. Tanzanian instruments move by Act, Government Notice, Finance Act and portal revision. If a sentence here disagrees with the live mandate-holder, the mandate-holder wins. Zatra Consultants Limited does not issue licences, permits, tax clearances or approvals, and gives no assurance of any regulatory or banking outcome. Professional fees are published only on /pricing/.

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