Section 86 of the Employment Rights Act
1996 (ERA) regulates the minimum periods
of notice on terminating employment.
Notice to be given by the employer:
- less than two years'
continuous employment, at least
one week;
- two years' to 12 years'
continuous employment, one
week's notice for each year of
employment;
- over 12 years' continuous
employment, not less than 12
weeks' notice;
- Notice to be given by the
employee continuously employed
over one month, at least one
week.
The period of notice to be
given by the employee does not
increase with longer service
although employers can, and
often do, vary the terms of the
contract to lengthen the notice
period. Similarly, employers may
contractually exceed the
statutory minimum periods of
notice they are required to give
employees.
If employees resign without
giving the required notice they
are not entitled to payment for
the period they should have
worked.
Employers may give pay in
lieu of notice, which is then
National Insurance and tax free
provided there is not a term in
the contract of employment which
states that the employer
reserves the right to make a
payment in lieu.
Employees on fixed-term
contracts have the same notice
rights as permanent employees if
the contract is terminated
before the expiry date. It is
therefore advisable to have a
notice of termination clause in
all fixed-term contracts, as a
failure to include one may
result in the employer being
liable to make full payment of
salary up to the agreed expiry
date should the contract be
terminated early. It is,
however, not necessary to give
notice on the expiry of the
fixed term as the end date was
stated at the beginning of the
contract.
Similarly, employees who are
retiring at the organisation's
normal retirement age do not
need to be given notice. It is,
however, good practice to give
notice and communicate fully
with employees.
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