Employment law
The project-based contract: a fixed-term contract with no end date, but not without an end
On the site of a health centre in Ségou, the foundations are poured, but nobody knows whether handover will come in fourteen months or twenty. The rains, the client's payments and cement deliveries will decide. To hire the crews, a dated fixed-term contract is too rigid and an open-ended contract too lasting. The Labour Code provides a contract built for this uncertainty, provided it is drafted precisely.
Our fictional running case: Kéné Bâtiment, a construction company in Bamako with 40 permanent employees, hiring 30 workers for this site.
1. What exactly are we talking about?
The project-based contract is an employment contract concluded to carry out defined works whose duration cannot be foreseen precisely. The law treats it as a fixed-term contract. All the general fixed-term rules therefore apply, except two. Labour Code, article L.18
The term is the moment the contract ends. In an ordinary fixed-term contract, it is a date. In a project-based contract, it is completion of the works: handover of the health centre, delivery of the road, commissioning of an installation.
What sets it apart from an ordinary fixed-term contract
| Ordinary fixed-term contract | Project-based contract | |
|---|---|---|
| Maximum duration | 2 years | No legal limit |
| Renewal | 2 times at most, the initial contract not counted | Prohibited |
| What ends the contract | A date or a certain event | Completion of the works defined in the contract |
A contract concluded for defined works escapes the two-year limit, but it cannot be renewed. Labour Code, article L.21
The project-based contract gains duration. It loses renewal.
2. When should it be used?
The test is not the trade. It is the impossibility of assessing the duration in advance. Typical situations:
- construction of a building, road or bridge, until handover of the works;
- installation or commissioning of industrial equipment;
- a project funded for a specific mission, until its close-out.
The ground that never holds
A fixed-term contract cannot be used to fill, on a lasting basis, a job linked to the company's normal and permanent activity. The site manager whom Kéné Bâtiment has moved from site to site for six years holds a permanent job: it calls for an open-ended contract, not a string of project-based contracts. Labour Code, article L.22
Conversely, if the contract sets a firm delivery date and the schedule is reliable, a fixed-term contract with a precise term is enough. For the general fixed-term rules, see Fixed-term contract (CDD).
What you need to do
- Reserve the project-based contract for works whose duration cannot be set in advance.
- Hire on open-ended contracts the employees who move continuously from one site to the next.
3. Drafting the works: the critical point
In this contract, the works serve as the term. If the subject is vague, the contract no longer has an identifiable end. And any contract that does not meet the fixed-term definition is an open-ended contract.
Decree No. 96-178/P-RM of 13 June 1996 (article D.20-1) requires a precise definition of the contract's subject. Where there is no precise term, the contract states the minimum duration for which it is concluded, as well as the post held and, where applicable, the length of the probationary period.
| What to write in the contract | Example at Kéné Bâtiment |
|---|---|
| The works and the client | Construction of the Ségou health centre on behalf of the municipality |
| The event marking completion | Minutes of provisional acceptance of the works |
| The portion of works assigned | Masonry of buildings A and B |
| The minimum duration | Six months |
| The post | Skilled mason |
The most common mistake
Writing "construction work" or "various sites". With such wording, nobody can say when the contract ends. The court may then find there is no term, and therefore an open-ended contract. Reclassification is when the court turns the fixed-term contract into an open-ended one.
What you need to do
- Name the works, their location, the client and the event marking completion.
- Specify the portion of works assigned to the employee, so crews can be released in stages.
- State a minimum duration and the post held.
4. The formalities its validity depends on
The contract must be in writing. Without a written contract, it is presumed to be open-ended.
No writing, no fixed-term contract. A verbal project-based contract is an open-ended contract.
If it lasts more than three months, the employer must file it with the local labour inspectorate before performance begins. A project-based contract almost always exceeds three months, so filing is the rule. Each breach exposes the employer to a fine of XOF 10,000 to 50,000, rising to XOF 20,000 to 100,000 for a repeat offence (article L.316).
A probationary period may be provided, but only in writing. During probation, either party may terminate without notice or compensation. It is the only window for free termination of the contract.
Example. Kéné Bâtiment forgets to file the 30 contracts before the site opens. The fine applies per offence: it can reach 30 × 50,000 = XOF 1,500,000, not counting the risk of reclassification for contracts not in writing.
What you need to do
- Have the contract signed before the first working day.
- File the contract with the labour inspectorate before work starts, and keep proof of filing.
5. How does the contract end?
It ends on completion of the works or of the portion of works assigned. This is what allows crews to be released in stages: the steel fixers leave when the structural work is done, the tilers stay until handover.
A delay on site moves the term; it does not remove it. That is the whole point of this contract: it absorbs scheduling uncertainty.
The post-site trap
The project-based contract cannot be renewed. If the worker keeps working after handover without a new contract, continued service automatically constitutes an open-ended contract. A new site requires a new contract, with new works. Labour Code, article L.20
What you need to do
- Notify each employee in writing that their portion of works has ended, with the effective date.
- Never let an employee work beyond completion without a new written contract.
6. Ending before completion: three doors, not one more
A fixed-term contract can be ended before its term only for gross misconduct, by agreement of the parties recorded in writing or for force majeure. Gross misconduct is the most serious misconduct recognised by the Malian Code; it deprives the employee of notice and compensation. Labour Code, article L.25
A halt to the site is not force majeure in itself
The Code does not define force majeure. A late payment by the client, a reorganisation or a budget freeze are part of the ordinary risks of a construction company. Presenting them as force majeure exposes the employer to rejection by the court.
What an irregular termination costs
If the employer terminates outside these three cases, it owes the employee damages equal to the pay they would have received until the term.
Example. Kéné Bâtiment dismisses a mason paid XOF 120,000 per month whose portion of works was still expected to last about 8 months.
Remaining pay: 120,000 × 8 = XOF 960,000 in damages
On the employee's side, notice does not exist in a fixed-term contract. A worker who leaves before the end without written agreement terminates the contract without justification: the employer may claim damages (article L.39).
What you need to do
- Document any gross misconduct before acting.
- Record in writing any negotiated departure, signed by both parties.
7. The end-of-contract payment: due, with one exception
When the relationship does not continue after a fixed-term contract, the employee is entitled to a precarity payment, which compensates for the instability of the job. It is calculated on the total gross pay due during the contract, at the rate set by the collective agreement or, failing that, at 2.5% (Decree No. 96-178/P-RM, article D.24-1). Labour Code, article L.24
Example. A Kéné Bâtiment worker worked 18 months at XOF 120,000 gross per month, with no more favourable collective agreement.
Total gross pay: 120,000 × 18 = XOF 2,160,000 Precarity payment: 2,160,000 × 2.5% = XOF 54,000
The exception to check in construction
The payment is not due in the cases listed in points 1, 2, 4 and 5 of article L.20. Point 5 covers sectors where it is customary not to use open-ended contracts, for jobs that are temporary by nature. Order No. 2024-4363/MTFPDS-SG of 27 December 2024 lists, among others, building and public works, mining exploration and emergency or humanitarian aid.
Consequence: for a company in these sectors, a project-based contract for a job that is temporary by nature may fall outside the precarity payment. Outside these sectors, it is due. It is also not due if the employee ends the contract, commits gross misconduct, or refuses an open-ended contract for the same or a similar job at a salary at least equal.
What you need to do
- Check whether your sector appears on the 2024 order's list, then read your collective agreement.
- Provision the payment from the site budget stage when it is due.
Key takeaways in 6 points
- Use the project-based contract only when the duration of the works cannot be set in advance.
- Describe the works, location, client and completion event precisely.
- Put the contract in writing and file it with the labour inspectorate before work starts.
- Never renew: a new site requires a new contract.
- End before completion only for gross misconduct, written agreement or force majeure.
- Check, depending on the sector, whether the 2.5% precarity payment is due, and provision it.