Employer's Rights Regarding Notice Periods

Peninsula Team

July 22 2011

There are two issues that need to be taken into account when determining how much notice an employee has to work, these being statute and the contract. These will set out the minimum amount of notice the party ending the contract is obliged to give. Either party can give longer notice if they wish but a shorter period of notice requires the agreement of the person receiving it.

Failure to give the correct notice is a form of breach of contract. Some contracts allow a company to give pay in lieu of notice as an alternative under the contract. Where this is not covered under the contract then the company is technically not giving pay in lieu of notice but is paying compensation for the breach of contract.

An employee under notice is obliged to work their notice period unless there is an agreement between the parties that it can be shortened.  However, depending upon the circumstances, they may not be entitled to be paid for any notice period not worked. The individual remains an employee of the company and under their control until the notice period has expired.

Where employees are held to their notice period but are not required to attend the workplace this is classed as garden leave. This is different from pay in lieu of notice because the contract remains in force. Garden leave means that an employee must be available during their normal working hours if instructed by their employer. They cannot, therefore, start work for someone else. They also cannot go on leave without requesting it in accordance with the company’s annual leave rules.

An employee wanting to leave without working their full notice will need to discuss this matter with their employer. The company is under no obligation to let an employee leave early and they will consider the needs of the company in respect of ongoing work and the need to recruit a replacement when determining if they will agree to any such request. If the company agrees to waive its entitlement to some of the notice period then the employee must understand that they are not entitled to any payment for the period that they don’t work.

An employee with annual leave booked during their notice period is still able to take it. Some companies will insist on employees taking any untaken accrued leave during their notice period and there will often be an express term within the contract setting out that obligation.

An employee should never assume that they will not have to work their notice so they shouldn’t commit to anything that will occur within that notice period without getting agreement first. If an employee fails to work their notice they could be sued for any costs that their employer incurs as a result of their breach of contract and this is often set out within the contract. Anyone carrying out recruitment should be aware of a candidate’s current notice period and should not assume that this could be shortened.
For more information on Notice Periods please contact the Peninsula Advice Service on 0844 892 2772.

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