With there being few jobs for life in the modern age, employers are used to giving notice of termination to staff.
However, what seems to be a straight-forward area contains some traps for the unwary. Rustom Tata, Partner in DMH Stallard’s Employment Team, answers some lesser known problems below.
Q: What form should notice take?
A: Unless the contract specifies a particular means (written notice being the most common), notice can be given verbally. Whichever form is required, it is crucial that notice is given in clear and unequivocal terms. Employers are best advised to avoid expressing notice conditional on something happening or not happening. Care should also be taken as to whether the contract requires written notice to be sent to a particular place (commonly the employee’s home address) and for this to be done by a particular means (such as registered post).
Q: When is notice effective?
A: In the context of the employment relationship, notice is generally effective when it is given, but this is subject to the proviso that it has been effectively communicated to the recipient. In the modern age of email, the employer would need to be able to show that the employee had received and read the email; sending it is not enough.
Q: The employee who has just been dismissed has been away on holiday. I didn’t know that. Can’t I rely on the normal rule that something is deemed to have been delivered two working days after posting?
A: Unfortunately not. Unless you can show that the employee was purposefully avoiding receipt of your letter (which is not unknown), notice will be effective when they actually read the letter.
Q: The employee is on holiday, but their spouse/ brother/friend has said they have been asked by the employee to take any letter for them. Should I agree?
A: Ideally, you would only do this if you have a written note from the employee confirming that this is what they want you to do and that they agree that any notice of termination of employment will be effective from the date when you give the spouse etc such a letter.
That will be very unlikely in most cases and so although you might agree, it is sensible also to send a ‘back up’ letter in the post to the employee’s home or last known address as well. Employers should probably then follow up to ensure that the employee acknowledges receipt.
Q: How to calculate when the employment comes to an end?
A: The amount of notice to which the employee is entitled is often clear – one week, one month etc. However, the notice does not strictly start to run until the day after it is received. So, one month’s notice given on 7th July starts on the 8th July and expires at the end of 7th July. This is something often overlooked with many employers calculating that if notice is given on the 7th, it will expire at the end of 6th July.
Q: Surely this is all just splitting hairs, the employee knows they have been sacked and that the employment is at an end?
A: Unfortunately, as with much in employment law the position is not straight-forward. If the contract has not been properly terminated by the employer it will continue and the employee may be able to argue that they have a continuing entitlement to pay. If the employer then receives a complaint from the employee that they haven’t been paid properly and seeks to terminate the employment in response, the employee is likely to have a strong claim for automatically unfair dismissal. That claim would not require the employee to have any minimum period of service.
Q: What about where I am making a payment in lieu of notice (PILON)?
A: It is critical to ensure that where a payment in lieu of notice is being made, that the employer is made aware in clear and simple terms of what is being done and of the amount which will be paid and when this is to occur. If the contract includes a PILON clause, its terms must be followed very closely. If they are not, then where the employee might otherwise be subject to restrictive covenants, that protection will be lost.
If you have any further enquries in realtion to this article or notice of termination, please contact Rustom Tata, Head of Employment at DMH Stallard.