What Myanmar law says
The Employment & Skills Development Law (ESDL) 2013 framework permits fixed-term renewal but discourages indefinite chaining. The widely accepted rule is up to 2 renewals after the original fixed-term contract; beyond that, the township labour office and Conciliation Body generally treat the employment as permanent. Once deemed permanent, future terminations require full ESDL notice and severance per Notification 84/2015. Silent rollover (the employee continuing to work after the term ends without a new contract) also converts the relationship to indefinite.
Renewal scenarios
| Renewal pattern | Treatment |
|---|---|
| Original 2-year + 1 renewal | Standard; second contract still fixed-term |
| Original + 2 renewals | Borderline; defensible if project-based |
| Original + 3+ renewals | Risk of deemed permanent |
| Different roles in each renewal | Each contract assessed on its own; less risk |
| Same role, rolling 1-year terms | High risk of deemed permanent after 2 cycles |
| Silent rollover (no new contract) | Treated as continuous indefinite employment |
What changes when deemed permanent
- Full ESDL notice schedule applies to future terminations (1 month under 5 years, 3 months at 5+ years).
- Severance per Notification 84/2015 applies on future employer-initiated termination.
- Tenure runs from the original start date, not the latest renewal.
- Statutory leave and SSB benefits accumulate over the full tenure.
- Restrictive covenants in the original contract carry over unless re-papered.
What if there's a dispute
- Township labour office first — common claim is repeated renewals should be deemed permanent and trigger severance.
- Conciliation Body — formal conciliation under the Settlement of Labour Disputes Law.
- Arbitration Council — final binding step. Statute of limitations: typically 6 months.
Employer takeaway
Cap renewals at 2 cycles after the original fixed-term contract. Avoid silent rollover by signing the next contract before the previous expires, or convert to a permanent contract. Tenure for ESDL purposes runs from the original start date once deemed permanent, so future severance must reflect that. Run final settlement on time, deregister from SSB within 30 days, and keep records for at least 7 years.
Edge cases and unenforceable clauses
- Renewal across group companies — generally not respected; township office tests substance.
- Auto-renewal clauses — risk silent rollover and deemed permanence.
- Different role in each renewal — reduces risk but is not a guaranteed defence.
- See max duration.
Common renewal mistakes
- Rolling 1-year contracts indefinitely to avoid severance.
- Failing to issue a fresh contract before expiry — silent rollover converts to indefinite.
- Counting tenure only from the latest renewal once deemed permanent.
- Skipping SSB continuity through renewals.
We publish practical, legally-grounded HR guidance for Myanmar employers. Each piece is reviewed by our compliance team against current MLIP and Labor Law requirements.