What Is a Fixed-Term Contract?

A fixed-term contract runs for a set period — say, six months or one year — and ends automatically on that date unless it says otherwise. That's different from an auto-renewing contract, which keeps going unless someone cancels, and from an indefinite (open-ended) contract, which has no set end date at all.

Analyze my contract — free Full mechanics: How Do You Cancel a Contract? (2026)

Why it matters

Fixed terms are common in freelance engagements, consulting agreements, and fixed-length employment offers — anywhere both sides want a known start and end. The clarity is the whole point: everyone knows when the relationship is scheduled to stop. The risk shows up at the edges — what happens right before, at, or after that end date — which a surprising number of fixed-term contracts never actually spell out.

What to watch for

No renewal language at all: the contract just stops, with nothing said about whether the work can continue, or how a new term would even get set up.
Early-exit terms buried elsewhere: a fixed term doesn't necessarily mean neither side can leave early — check for a separate termination for convenience clause that lets one side (or both) end things before the term is up.
Silent rollover into month-to-month: some fixed-term contracts say that if work continues past the end date without a new agreement, the same terms keep applying indefinitely — worth knowing before you keep working past the date.
Survival gaps: which obligations (confidentiality, IP assignment, non-compete) are meant to continue after the fixed term ends, and which aren't, is often left unstated.

A realistic example

A consultant signs a six-month fixed-term agreement with no renewal language. In month five, the client wants to keep the relationship going. Because the contract never addressed what happens next, they're left negotiating an entirely new agreement from scratch — under time pressure, with no fallback terms to lean on in the meantime.

What to ask for

Explicit end-of-term language: does the contract simply lapse, require notice to end on time, or need a new signed agreement to continue?
A defined renewal path if ongoing work is likely — a short mutual, written renewal rather than a silent auto-renewal, so neither side is bound without agreeing again.
A survival clause naming exactly which obligations (confidentiality, IP, non-compete) continue past the end date, and for how long.

Related terms: auto-renewal clause · termination for convenience Related guide: How do you cancel a contract?

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Not legal advice. This is an educational definition of a common contract term. Details vary by jurisdiction — this page explains common U.S. usage. For high-stakes agreements, have a lawyer review the final version.