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When does notice period start for an employee?

The Supreme Court recently ruled in Newcastle upon Tyne Hospitals NHS Foundation Trust (Appellant) v Haywood (Respondent) [2018] UKSC 22 that, in the absence of anything else about this in the contract, a notice of dismissal by post only took effect when it had actually been received by the employee and the employee had either read or had a reasonable opportunity to read it.

What does this mean in this case?

In this case the employee was on holiday. Mrs Haywood was dismissed by her employer for redundancy. There was no term in her employment contract about how notice was to be given. Her contract provided for a minimum notice period of 12 weeks without anything more.

On 20 April 2011 the Trust sent a letter to Mrs Haywood’s home address giving written notice of termination of her employment. Mrs Haywood was away on holiday when the letter was sent and the Trust knew this. Her father-in-law collected the letter from the local sorting office on 26 April 2011 and Mrs Haywood read the letter on her return from her holiday abroad on 27 April 2011. Not much of a welcome home.

Both the High Court and Court of Appeal upheld Mrs Haywood’s case that notice only started to run on 27 April 2011, and the Supreme Court dismissed the Trust’s appeal.

What does this mean for employees?

For Mrs Haywood the date on which notice started was of vital importance. The court’s decision that the notice period only started on 27 April 2011 meant it expired on 20 July 2011, the date of her 50th birthday, and as a result she was entitled to an enhanced pension.

If there are clear terms of notice this always takes precedent.

For employees it is important to remember that an express term in your employment contract trumps any implied terms about notice, so the starting point is always your contract.

More generally, the outcome in this case could affect end dates and produce various different results. For example, in order to benefit from unfair dismissal rights you normally need a qualifying period of two years. If your employer sends a written notice said to expire before two years’ service and your contract is silent about how notice takes effect and your circumstances are such that you do not know you are being dismissed until a later date then this could extend your effective date of termination to take you over the threshold to benefit from unfair dismissal rights.

What does this mean for employers?

As an employer there are different points to think about:

  1. Check your standard employment contracts. Do they specify how notice is to be given? As is nearly always the case, certainty is best to avoid the need to imply terms which may not be helpful. The contract could state, for example, that notice is served the day after posting or that notice can be served by e-mail. This doesn’t leave any room for doubt where an employer keeps posting and/or delivery receipts.
  2. Keep your HR records in good order and up to date. Issues may arise where an employee cannot be contacted. For example, if an employee is on sabbatical or sickness absence, up to date HR records are going to be important.
  3. Do not takes things to the wire. Why wait until an important deadline is looming such as 2 years for unfair dismissal or an enhanced pension trigger date to issue notice? Think ahead, diarise key dates and take action sooner rather than later. That may sound obvious but cases such as this would not be making news if it happened in practice.