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Peninsula: Notice periods - advice for employers

There are two types of notice which can apply upon a termination of employment – statutory and contractual. Statutory notice is the minimum required by law. You can choose to give notice over and above this amount, but never less than it. Here’s what you need to know to get it right.

Depending on the employee’s length of service, the statutory notice you need to give them can vary:

  • If the employee has recently started and has worked for you for less than 1 month, then they’re not legally entitled to any notice period
  • If an employee has at least 1 month’s service but less than 2 years’, they’re entitled to 1 week’s notice
  • If the employee has 2 or more years of continuous service, then they should be given 1 week for each complete year of service, up to a maximum of 12 weeks

You should note that continuous service is used to work out the notice period, so always check whether any previous service should be taken into account – for example, if the employee has had a former role with you or has transferred over through TUPE.

A note on contracts…

Employees may be entitled to a longer notice period depending on their contract of employment. If contractual notice and statutory notice differ, then you should always give the longer period of notice. If you don’t comply with an employee’s contractual entitlement, you’re under risk of a wrongful dismissal claim.

Remember that normal notice should be given to an employee even if the reason for the termination of employment is redundancy.

Notice and gross misconduct

If the employee has at least 1 month’s service, a notice period applies in all but gross misconduct terminations.

If you summarily dismiss an employee because you reasonably believe that they’ve committed an act of gross misconduct, you’re not under an obligation to allow them to work any notice, nor to pay them in lieu.

In circumstances where notice is due, you may give the employee a payment in lieu of their notice – but only if you’ve reserved that contractual right. If there’s no contractual clause for PILON (pay in lieu of notice), you may be breaching the contract of employment if you pay the employee instead of letting them work their notice.