Giving an employee the correct notice to end their contract of employment is a key part of the dismissal process. The specific date that notice starts running is an important matter as this determines the end-date of employment, usually a significant date relating to certain rights and making tribunal complaints. The Supreme Court has recently clarified when written notice of dismissal will start running.
In Newcastle NHS Trust v Haywood, a redundancy process was started in 2011 following a merger of two trusts. The Associate Director of Business Development, who had over 30 years’ service with the NHS, was invited to a meeting and informed that her role was at risk of redundancy. Alternative roles were discussed, but turned down due to their lower seniority and pay.
The employee had pre-planned annual leave to go abroad and asked her employer to refrain from making a final decision until she returned. Despite this request, the trust sent her written notice of redundancy by recorded delivery on 21st April. She was provided with her contractual notice of 12 weeks, with her date of dismissal stated as the 15th July.
In her absence, the registered letter was collected from the sorting office and left at her house. The employee did not have an opportunity to read the redundancy letter until she returned from her holiday on 27th April.
The employee argued that her 12 week notice period began from the date she actually read the letter and not, as the trust believed, the date the dismissal letter was posted to her address. Importantly, if her notice period started from the 27th April, her date of dismissal was 20th July. This was the date the employee would celebrate her 50th birthday and become entitled to a significant early retirement pension.
The Supreme Court has now ruled that, unless specified otherwise in the employment contract, written notice only becomes effective when the recipient has received the letter and read it. Alternatively, if this date is earlier, when the letter is received and there has been a reasonable opportunity to read it.
The Court agreed the employee could not have had an opportunity to read the dismissal letter as she was out of the contract on the date this was delivered. As a result, the employee was entitled to her pension benefit and she was awarded just under £400,000 in damages.
What does this mean for employers:
• Without an express contractual term, this decision confirms an implied contractual term will apply which says written notice starts when the letter is received and read by the employee, or they have had a reasonable opportunity to read this;
• This can, however, cause great uncertainty about when the letter was received, whether it has been read and what a “reasonable opportunity” will cover;
• To ensure clarity regarding the delivery and receipt of dismissal notice, employers can provide employees with verbal notice of dismissal and confirm this in writing;
• Alternatively, employers can use a face-to-face meeting with the employee to provide them with the written notice and require them to read this during the meeting to ensure notice runs from the required date.