If the service contract is of limited duration, the duration thereof shall not be more than 5 yrs. This period may be renewed for a similar period or periods by agreement of the two parties.

If the contract has not been renewed and the parties thereto continue to abide by it after expiry of its duration without an explicit agreement, the contract shall be considered to have been renewed for unlimited durations on the same conditions provided for therein.

The renewed duration shall be considered to be an extention of the previous duration and the period of service of the worker shall be calculated as starting from the date of his entering the service of the employer for the first time.