It is a requirement that when an employee is issued with a statement of main terms and conditions (contract) that there is a clause that stipulates the period of notice required.
The period of notice will not necessarily be the same from the employer and the employee – it is possible that they will be different and there is no requirement for the notice periods to be the same.
There is also a story that often gets quoted that says that the period of notice required is based on whether the employee is weekly or monthly paid – misleading and untrue.
So, what do we need to know about notice periods?
Statutory requirement
Importantly, there is a statutory requirement that sets out the minimum periods of notice to be given by an employer to an employee in the event of termination and this is based on length of service and is as follows
Less than 1 month – no statutory period of notice
1 month and up to 2 years service – statutory notice period – 1 week
2 – 12 years – statutory notice period – 1 week per completed year of service
12 years or more – statutory notice is 12 weeks.
In the event that there is either no contract or no notice clause, the period of notice that the employer is required to give the employee will be in accordance with the above.
These periods of notice also apply in the event of redundancy, unless there is a contractual provision or agreement to the contrary.
However, there are no minimum statutory periods of notice in respect of the employee giving notice to the employer. These will vary and the employee may only be required to give 1 week or maybe 4 weeks but the notice to be given by the employee should be set out in the contract.
Probation periods and notice period
There is no specific correlation between notice period and probation but typically, there will be a contractual provision whereby the notice period is greater when the probation period has been completed. Commonly, if an employee’s employment is subject to a 6 month probation period, it is likely that during the probation period notice of termination on either side will be 1 week and it may increase to 1 month thereafter. And, in the event that the probation period is extended, the notice period only changes when probation is successfully completed.
Extended notice periods
It is not unusual for employees to have a longer notice period – say 3 or 6 months on either side. This will normally reflect the seniority of the employee, as well as their value and worth to the business but it may also be because they are in a role that is business critical and a longer notice period is required to either manage a handover or recruit a replacement.
It is advisable for employers to periodically review the notice periods of their senior leadership because otherwise there is a risk that a senior employee resigns and is only required to give 4 weeks notice.
On the flip side, some employees are naive about notice periods and accept a very highly paid job but fail to check what notice they are entitled to receive if it doesn’t work out.
Contractual v Statutory notice
If a notice clause in a contract stipulates a period of notice longer than the statutory notice period, the terms of the contract will prevail but the terms of the contract must never be less than statutory minimum.
Pay in lieu of notice – PILON
Most notice clauses in contracts will have a clause that allows the employee to make a payment in lieu of notice. This means that rather than an employee having to work their notice, employment is terminated sooner and a payment in lieu of notice is made and PILON payments are subject to statutory deductions.
Going to a competitor…
If an employee resigns and advises that they are going to a competitor, the employer will immediately want to take them off share drives, e-mails etc so that they are not a commercial risk to the business.
In these situations, the employee will often be put on garden leave or a form of paid leave where they are still employed by the Company but they are not required to carry out any duties for the duration of the notice period. This will mean that the employee is at home but is not free to take up the employment offer with the new company.
Strictly speaking, an employee can only be put on garden leave if there is a garden leave clause in the contract but it is unlikely that the employee will object because they’re being paid to do nothing.
Employee didn’t give the correct notice
This is a very regular query – let’s say the employee is required to give 4 weeks notice but after a few days, they don’t come back. In that situation the employer is only required to pay the employee up to the day they left and will invariably withhold holiday pay but in these situations, the employee is potentially in breach of contract but the employer has to make a commercial decision whether it is worth pursuing the employee or just leave it. However, in some contracts of employment, there will be a specific clause that allows the Company to deduct monies in respect of the number of days that the employee didn’t give the correct period of notice.
If you want advice regarding any of the issues raised, either call 07885 714771 or e-mail – adrian@abhrsolutions.co.uk
