Giving and Accepting Notice
If the employer or employee wishes to end the employment relationship they must give each other notice.
When an employment contract is ending the employer and employee have certain rights in terms of the notice period. Usually when an employee or employer decides to end the employment they must give each other a minimum period of notice (e.g. two weeks / a month / three months).
If you have been employed for a month or more, you must give the employer at least one week's notice before you leave.
The employer must give an employee:
- at least one week's notice (if they have been employed for a month or more)
- at least two weeks’ notice after two years of service/employment
- at least three weeks’ after three years and so on up to 12 weeks’ after 12 years or more.
(These are known as ‘statutory’ notice periods because they are required by law).
However, the employer or the employee will be entitled to a longer period of notice if it says so in their contract of employment.
Most employees are entitled to payment during the statutory notice period.
If they wish to, employees can give up their right to be given notice that their employment is ending. They can also give up their right to receiving payment instead of working their notice (Pay in Lieu of Notice – PILON). Employers can also give up their right to receive notice from the employee that he/she is leaving.
Pay in Lieu of Notice (PILON)
Sometimes the employee does not need to work their notice and a sum of money can be paid to them instead. This is known as Pay in Lieu of Notice or PILON. Doing this is only lawful if the contract of employment clearly says it is allowed, or if the employer and employee discuss it and both agree to it. If the employer tries to force the employee to take payment in lieu of notice, even though it is not set out clearly in the employment contract and the employee does not agree to it, it could be seen as a breach of contract.
Effective Date of Termination
The Effective Date of Termination is usually the last day worked, unless the employee is on a period of ‘Gardening Leave’. Gardening leave is when the employee is paid as usual during the notice period but does not have to work it. When that happens the Effective Date of Termination is usually the date the notice period ends.