Whether resignation or dismissal, redundancy or retirement, employees are due to work a specified notice period before their employment ends. Only in rare cases, such as acts of gross misconduct, may an employer dismiss an employee without notice. It’s crucial that both employers and employees understand their legal rights around notice periods, and the distinctions between them. Firstly, there are two main types of notice period: statutory and contractual.
Statutory notice periodStatutory notice is required by law; however the period of notice itself depends on the length of continuous service worked by each individual employee. Employees who have worked between one month and two years’ continuous service are required to work a minimum one week’s notice. Employees who have worked two years’ continuous service are required to work a minimum two weeks’ notice, and one additional week’s notice thereafter for each completed year. For example, if an employee has worked five years’ continuous service, they would then be required to give five weeks’ statutory notice unless stated otherwise in their contract.
Contractual notice periodContractual notice periods are company policy that must be specified as part of the main terms and conditions of employment, either in the employment contract or employee handbook. This period can be the same as, or longer than, the statutory minimum, but not shorter. An employer may give pay in lieu of notice, providing there is a contractual clause that gives the employer the right to substitute notice with pay. If this clause is not clearly stated, a claim for breach of contract may be filed against the employer.
Statutory redundancy notice periodThere are also additional statutory terms to be aware of that are specific to redundancy. In this case, employees must be given one week’s notice if they have been employed between one month and two years. They must be given one additional week’s notice for each year thereafter, up to 12 years. If the employee has been employed for 12 years or longer, the statutory notice period remains set at 12 weeks – this is the maximum statutory notice period for redundancy.
Purpose of giving noticeIn the event of dismissal or termination, notice periods give employees time to plan their next steps and seek alternative employment. In the event of resignation, employees are required to give the specified notice to their employer, which allows the employer time to seek a person to fill the role.
The law behind notice periodsLegislation regarding notice periods is detailed in the Employment Rights Act 1996.
- Employers should be aware of the difference between statutory and contractual notice periods and that the length of these periods usually depends on how long an employee has been employed by the company.
- There are also additional statutory terms that are specific to cases of redundancy.
- Any contractual notice period must be clearly stated and signed off by the employee as part of the employment contract or employee handbook.