Job Offer but with a twist nonetheless

I recently had been in interview process with a company I had a good impression of, for a position that actually upgrades my career. There were 4 Rounds which went well. Now they reached out to me or a job offer. I was okay with most of the conditions apart from one, that the contract is initially limited to 2 years. They never did mention this during the interview process which was humm all but normal.

The side effect on my personal situation of the time limited contract.

Anyway my personal situation is that I am planning to buy a property in the coming 6 months and would depend on a bank to finance it and after a debriefing with my bank consultant they mentioned clearly that based on limited contracts they don't offer home loans.

Raising my concern to the company about limited contract.

I raised my concern to the company, to which they said unfortunately it's a regulation that comes from their parent company that they need to adhere to , so the first contract is always limited but they also offered following reassurances:

  1. They are willing to strike off/reduce the probation time.
  2. And a proof of their low fluctuation rate. Most of the employees have been working on long tenures there already.
  3. They do decide 6 months in advance before the end of first 2 years if both parties wanna agree on an unlimited contract after the end of first 2 years.

Probable Solution

As it kind of turned into a catch-22 for me while the new position as team lead is a jump in my career but on the other hand it has an uncongenial effect on my personal plans in the future.

Asking the company to pull back/prepone the time of signing the unlimited contract, that is not waiting till the end of 1.5 years tenure for signing the final unlimited contract, rather do it after first 6 months if everything goes well.

This would enable me to apply for my home loan after 6 months while I would have a proof of long term income. Which would be okay for my personal plan.

My Question is: I am not sure if there would be some hidden side effects of doing it as I actually would end up with 2 contracts signed with them after 6 months, god forbid if something changes after an year or so and I wanna switch then there would be an overhead of quitting not 1 but 2 contracts? Or any other probable side effects?


Location = (Germany)

  • You should change jobs every 2-3 years anyway...
    – Justas
    Jul 25 '20 at 22:56
  • 4
    @Justas Sorry don't agree. If your employer gives you chances to work in sound conditions and offers chances to step up the career ladder. I would rather stick to one such employer for decades! If you are lucky enough to find one is another topic.
    – Anirudh
    Jul 26 '20 at 7:37
  • 1
    @Justas I agree with Anirudh... why do you think that what you state is a fact? In my case, I've been now close to 4 years in my current job and I intend to continue here
    – DarkCygnus
    Jul 27 '20 at 3:38
  • Assuming the job really is great for your career, and the company can't/won't budge from their 2-year requirement, I would recommend taking the job anyway. Having to hold off on buying a property for another 1-2 years sucks, but you can deal with it. Enhancing your career will pay dividends for the next 30 years and IMO far outweighs the negatives of having to wait a little longer.
    – Kaz
    Jul 29 '20 at 9:41
  • @DarkCygnus should is not must, you can stay more if progressing and decently paid. Just not easy to find.
    – Justas
    Aug 2 '20 at 22:44

Yes, that is a classical problem.

By the spirit of the law, limited time contracts are only allowed in Germany, if the work itself is limited time. For example, hiring a secretary on a one-year contract would only be valid if you knew you only had work for one year, maybe as attorney with a new, bigger case that will end eventually. Or hiring a construction worker for 2 years because it will take that long to build the latest project. Or a stand-in in about any job for someone else on maternity leave.

It was never meant for companies to hire people on limited time contracts to basically get one "get out of jail free" card to screw over their employee without regards to labor law. Because there is no law about having to renew a limited time contract. It's basically their one point in time where -labor laws be damned- they can "fire" someone for no reason or any reason (sounds familiar?) by simply not extending their contract.

It is even explicitly forbidden to have multiple limited time contracts with someone as a company (I think 2 are the maximum) because if you have enough work to hire someone 3 times in a row, you must make them a permanent employee.

On the other hand side, the bank's rules follow the spirit of the law. Limited time contract means you have work until the contract ends and then you will be unemployed. Because the work is gone. The building is build, the case is over, the worker is back from maternity leave, whatever it was that prompted someone to hire you for a limited time, it's passed. They will not give out a loan to people who's job has an in-built self-destruct mechanism.

In the end, it's your decision whether it's worth it. As a software developer in Germany, it's your call. They are looking desperately, don't let them fool you. The market is dry. We are recruiting people from other continents to please uproot their whole life and come work for us. You would find another job in a heartbeat. On the other hand, maybe it pays so much more that your house is considerably more affordable in 1.5 years when you hopefully get that permanent offer? It's your decision.

The one thing that is certain though: The bank won't move an inch. No permanent contract, no loan.

  • Your legal information is incorrect. I wonder why you seem to think you know the "spirit of the law" better than the courts? Have you written it? Are you a lawyer?
    – bytepusher
    Jul 25 '20 at 19:32
  • 5
    Funny how you think you know it better, but don't have any substance to prove it, not even a link. i will entertain you: read this: de.wikipedia.org/wiki/Befristetes_Arbeitsverh%C3%A4ltnis It will tell you everything I just told you above. It has links to the laws in question. It even tells you why the laws were made, what they were supposed to prevent, which I call "spirit of the law".
    – nvoigt
    Jul 25 '20 at 19:42

• I guess this is in India, and, your problem is the bank loan requirement. They don't like the "2 year contract" arrangement.

• You are trying to work out "some sort of solution" by modifying the deal at hand with the company at hand.

Unfortunately. My guess is it will "never work out". You will get a "half-assed" or "botched" arrangement of the current possibility; as you suspect and hint at it will bring some other unforeseen problems.

The company at hand will never "really be happy" as it goes against their systems, and the bank would probably anyway say No in the end once it is kicked up the chain.

Unfortunately I believe that trying to "massage" the situation at hand, would not result in a satisfactory solution either to the "banking crisis" or the job situation.

I fear either

  1. politely explain to the company at hand that you have to respectfully decline their offer, due to the silly bank situation, and look for another job or,

  2. sadly set aside the house-buying plan, and snatch up this job role (if it's a good one and worth it).

  • 1
    Errm! This is actually in germany.
    – Anirudh
    Jul 25 '20 at 15:24
  • 5
    German here: I worked for a company which also did this. Worked out for me. A senior developer said he only will sign an unlimited contract and played the ball back to the company. We really wanted him, so he got an unlimited contract. Only do this if them saying no is ok for you.
    – Benjamin
    Jul 25 '20 at 15:28

Your suggestion to the company will be refused, most likely.

You need to consider why the company has this contract requirement. It is typical in the tech financial sector. They don't want to be in a position where they are stuck with an employee. Having many employees as contractors allows them to quickly increase or lower their workforce. There's no paperwork, employment insurance, benefits to consider. They will just contract out more people or end up a whole lot of contracts.

It also looks better in the financial sheet. Revenue per employee and profit per employee are important metrics. They also won't make exceptions, because in locations that are not at-will, a single exception might make the whole setup visible as a gimmick to bypass employment laws.

IMO when they said "regulation that comes from their parent company" they meant: "sorry, this will not be tweaked in any way. Even our whole division is arranged in a way that the parent company might let it go tomorrow"

Prepare for them to say "sorry, we're not flexible in this regard".

Also, be diligent and check your local laws for being a contractor. Check if they will require you to incorporate into a company. Check employment insurance impacts. Check the tax impacts. And check with existing employees about the typical pay cut you'll get going from contractual to full-time. They'll justify it as "yeah, it's less but think of all the benefits!"

Following your comment about it being Germany: definitely a way around employment laws. They won't budge.

  • 1
    as I read it, he wouldnt be a contractor, but having a normal employment contract limited to 2 years. But yeah, way around employment laws. But still, they might budge if they want him bad enough.
    – Benjamin
    Jul 25 '20 at 15:30
  • 3
    I don't believe this is typical in the tech sector at all. For a job opening to implicitly be a permanent position, but actually to find out at the end that it's a fixed short-term position, without any of the arrangements (daily rates, higher pay) normally associated with being a short-term contractor? That's not normal at all IMO. Companies should not take on permanent stuff while treating them as temporary to avoid things like employment insurance, in fact that sounds legally highly questionable (IANAL). Jul 25 '20 at 15:37
  • 1
    I couldn't agree more with @BittermanAndy Actually I am slowly getting a feel of being manipulated through this time limited contract thing when the rate they are offering is actually just par with the rates for permanent positions.
    – Anirudh
    Jul 25 '20 at 16:28
  • Hey, I just tried to explain what the company is doing (been there got it done to me). I don't endorse it. Thanks for the downvotes.
    – Jeffrey
    Jul 25 '20 at 16:42
  • Limited time and contractors are two different things in Germany. I agree with the summary of your post, but it's not like contracting.
    – nvoigt
    Jul 25 '20 at 17:39

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