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So when does Notice of Termination Actually take Effect?

View profile for Manisha Chauhan
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You issue a letter of notice to your employee by post. The question is however, does the notice of termination take effect on posting, delivery or on communication of the notice if there is no express term in the contract of employment stating when the notice will be effective?

This was considered in the case of Haywood v Newcastle Primary Care NHS Trust.

Mrs Haywood had worked for the Trust for 30 years, more recently as an Associate Director. She was on annual leave from 19 April until 3 May 2011. On 20 April 2011, the Trust sent 3 letters to Mrs Haywood confirming her redundancy and claiming to terminate her employment with 12 weeks’ notice, with her last day being 15 July 2011.

The letters were sent by various methods of communication as follows:-

  1. One letter, which was incorrectly dated 21 April was sent by recorded delivery and a slip was left at her home on 21 April as there was no one present to sign for the letter. A family member collected the letter on Mrs Haywood’s behalf on 26 April and left it at her home for her to open on her return. Mrs Haywood returned from her holiday on 27 April, when she read the letter.
  2. Another letter was sent by normal post. There is no evidence to suggest when this was received by Mrs Haywood.
  3. The Trust sent a further copy of the letter by email to Mrs Haywood’s husband’s email address. The email was read on 27 April at 10:14am.

The question posed to the courts was when the notice was deemed to have been received given that the contract remained silent on this point. The reason why this was of such significance was because if the notice period expired after Mrs Haywood’s 50th birthday, she was entitled to a much higher pension. In order for this to be the case, notice of termination was required to be given after 26 April 2011.

On review, the High Court found that in the absence of express wording in her contract of employment, notice was deemed to have been effective from the date Mrs Haywood actually read her letter of dismissal (27 April 2011), therefore meaning she was entitled to a higher pension. The High Court awarded Mrs Haywood £400,000.

The Trust appealed the judgement and the case went to the Court of Appeal who dismissed the appeal.

What affect does this decision have on employers?

Quite simply, none, providing you ensure your contracts of employment clearly set out how notice should be given and when it is deemed to have been received to avoid any ambiguity.

If the contract of employment remains silent on this issue, give notice in person or where you are unable to, send by recorded delivery.  In such circumstances, notice will commence on the date that it is actually read by the employee.

If you require advice on notice periods or any other area of Employment Law, please do not hesitate to contact a member of the Chattertons’ Employment Team.

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