Fixed-Term vs Permanent Contracts in Morocco: When to Use Which

The single most common Moroccan employment lawsuit from SMB employers starts the same way. A Casablanca founder hires on a CDD (fixed-term contract) because it feels safer. The first CDD expires. They sign a second. Then a third. Eighteen months in, the employee leaves, claims they were effectively permanent all along, and the court agrees. Result: severance, damages, and back-pay for rights the employer thought they had avoided.

The Code du Travail is deliberate about when a fixed-term contract is legally allowed and when a permanent contract is the only valid option. Getting this right up front is straightforward. Getting it wrong is a multi-year legal cleanup. For the wider Moroccan HR landscape beyond contracts, see our Morocco HR guide.

The two contract forms

Moroccan law recognises two main contract forms for standard employment relationships:

• CDI (contrat à durée indéterminée): an open-ended, permanent contract. The default for any ongoing role. Termination is subject to the Code du Travail's notice, severance, and fair-procedure rules.
• CDD (contrat à durée déterminée): a fixed-term contract with a specific end date or defined project scope. Permitted only in the limited circumstances the law recognises.

A third category, the contract for a specific task (contrat pour accomplir un travail déterminé), exists for clearly defined one-off projects but is less common in SMB practice.

The default position in Moroccan employment law is CDI. A CDD is an exception, and the Code du Travail lists specifically when that exception applies.

When a CDD is legally allowed

Under Article 16 of the Code du Travail, a CDD can be used in four main situations:

• Replacement of an absent employee. If a permanent employee is on maternity leave, extended sick leave, or another protected absence, you can hire a CDD worker to cover the gap. The contract ends when the permanent employee returns.
• Unusual or temporary increase in business activity. A short-term project, a seasonal surge, or a specific client contract that expands your workload for a defined period.
• Seasonal work. Roles that are inherently tied to a season, such as summer hospitality or agricultural harvest.
• Start of a new business. A CDD is allowed for the opening phase of a newly established business, for a maximum of one year, renewable once (so two years in total), after which the role must convert to CDI.

If the role does not fit one of these categories, a CDD is not legally valid. Hiring a developer on a CDD to work on your core product indefinitely is the classic misuse, and courts have been consistent in reclassifying these contracts.

Duration and renewal limits

The rules on duration and renewal vary by sector.

Non-agricultural sector:

• Maximum duration of a CDD: 1 year
• Renewable once (total 2 years maximum)
• After the maximum, the contract must convert to CDI if the employee continues in the role

Agricultural sector:

• Maximum duration of a CDD: 6 months
• Renewable once, with a cap of 2 years total

Seasonal work:

• Fixed-term agreements of up to 6 months, renewable within the constraint that total duration over 2 years triggers CDI conversion

New-business exception:

• A new business can use CDDs in its opening phase for up to 1 year, renewable once (2 years total in the opening phase)

Once the legal maximum is reached and the employee continues to perform the same role, the contract is treated as a CDI by operation of law. This is true whether or not the employer drafts a new document. The reclassification happens automatically.

Automatic reclassification as CDI

This is where most SMB employers get caught. The Code du Travail and Moroccan courts will treat a CDD as a CDI in several circumstances:

• The employee continues working after the CDD's expiry without a new contract
• The CDD has been renewed more than once
• The total duration exceeds the statutory maximum for the sector
• The role covered by the CDD is ongoing rather than time-limited
• The CDD is used for a category of work that doesn't fit Article 16's permitted exceptions

Once reclassified, the employee is entitled to everything a CDI employee gets: standard notice, severance on termination, and the full protections of the Code du Travail against unfair dismissal.

The practical cost of reclassification is not small. An employee who has been on successive CDDs for two years and is then terminated as if their CDD had simply "ended" can claim damages for unfair dismissal plus all the accumulated benefits of CDI status.

Termination: CDI vs CDD

The termination rules differ significantly between the two contract forms.

CDI termination requires:

• A legitimate reason (economic, disciplinary, or performance)
• A fair procedure, including a hearing where the employee can respond
• Written notice or pay in lieu, based on statutory scales
• Severance pay (indemnité de licenciement) for employees with sufficient service
• Payout of any accrued, untaken leave

Severance for a CDI terminated for economic reasons is calculated at 96 hours of wages per year of service for the first 5 years, rising in bands for longer tenures up to a maximum specified in the Code du Travail.

CDD termination is more constrained:

• Automatic termination at the agreed end date
• Early termination by the employer is only allowed for gross misconduct, force majeure, or by mutual agreement
• An employer who terminates a CDD early without a valid ground must pay the employee the wages that would have been earned through the remainder of the contract

This "ride out the contract" rule means that a CDD is not a shortcut for easy termination. An employer who realises a CDD hire isn't working out 3 months into a 12-month contract is generally locked into paying out the remaining 9 months unless the employee is willing to agree to an early exit.

Trial periods

Both CDI and CDD allow for a trial period (période d'essai) during which the standard termination rules don't fully apply. The Code du Travail caps the trial period at:

Category	Trial period (max)	Renewable
Managers (cadres)	3 months	Once (6 months total)
Employees (employés)	1.5 months	Once (3 months total)
Workers (ouvriers)	15 days	Once (1 month total)

For a CDD, the trial period must be proportionate to the contract's total length and cannot exceed the scales above. Any trial period has to be explicitly written into the contract; it does not exist by default.

Practical guidance

• Default to CDI unless you have a specific Article 16 reason. If the role is ongoing, CDI is the only valid form. Using CDD because it "feels lower-commitment" is the trap.
• Don't chain-renew CDDs. If you've already renewed once, the next step is CDI. Planning for a third CDD for the same person or role is a court case waiting to happen.
• Keep the reason for a CDD documented. If you're legitimately using a CDD (e.g., to replace a maternity-leave employee), keep the paperwork trail linking the CDD to that specific exception. A contract generator that captures the reason field on every CDD gives you an audit trail for free.
• Treat trial period termination as still requiring process. Summary dismissal during a trial period is not a blank cheque; basic fair-hearing expectations apply, and courts have been increasingly receptive to claims from probationary workers denied a hearing.

Our Moroccan hiring guide covers the end-to-end process for a new hire, and the patterns for drafting compliant contracts are similar to the Kenyan contract template guide, though the specific clauses differ. Whichever form you pick, the signed contract should live in a searchable document store alongside the employee's other records, not in an email thread.

Key points

• CDI (permanent) is the default form of Moroccan employment contract
• CDD (fixed-term) is only legal in four specific circumstances: replacement, temporary activity increase, seasonal work, or new-business opening phase
• Non-agricultural CDDs max out at 1 year with one renewal (2 years total)
• A CDD that outlasts the statutory maximum, or is used for ongoing work, converts automatically to CDI
• Early termination of a CDD requires gross misconduct or force majeure; otherwise the employer owes the remaining wages
• Trial period scales: 3 months for cadres, 1.5 months for employés, 15 days for ouvriers, each renewable once

Getting the contract form right on day one is the cheapest hour you'll spend on Moroccan employment law. Getting it wrong is the most expensive mistake an SMB employer can make in the first two years of a role.