Employee Entitlements on Termination of Employment

Notice

Unless you are dismissed for gross misconduct you will normally be entitled to a period of notice or a payment in lieu of notice if your employer terminates your employment.

If you have a contract of employment or staff handbook, this is the first place you should look to find out your notice period.  If you have no written contract or handbook which states your contractual notice period, statutory notice periods will apply.  Statutory entitlement is as follows:

In the first month of employment you are not entitled to any notice.

After 1 month but with less than 2 complete years’ service  –  1 week
And thereafter, 1 weeks’ notice for each completed year of employment up to a maximum of 12 weeks

(so: 3 years’ employment = 3 weeks’ pay up to 12 years’ employment = 12 weeks’ pay)

After 12 years’ employment your notice entitlement does not increase.  

The period of notice that your employer specifies in your contract of employment must be at least equivalent to your statutory notice entitlement.  Therefore if your notice period is 1 month but you have been employed for 5 years or more it will be insufficient notice and you are entitled to receive 1 week per complete year of service.

Your entitlement to notice applies to dismissals on grounds of capability, conduct (but not gross misconduct), redundancy and any other reason for terminating employment.

If you have been found guilty of gross misconduct, your employer can terminate without notice.

Redundancy Payments

If the reason for terminating your employment is redundancy, you may be entitled to a redundancy payment.  To qualify for a redundancy payment you must be an employee (not a worker or self-employed) and have been continuously employed by your employer for at least 2 years.

Redundancy is calculated according to your age, length of service and weekly pay.  As a rough guide, if you are aged between 22 and 41 you will be entitled to 1 week’s pay per year of service.  For each year’s service between 18 and 22 you only receive 0.5 times a week’s pay.  If you are older than 41, for each complete year over 41 your entitlement is increased to 1½  x  a week’s pay.  The maximum period of employment that can be taken into account for statutory redundancy pay is 20 years.

Weekly pay is based on your actual pay or the statutory ceiling, currently £450.00, whichever is the lower.  Because your exact redundancy payment will depend on the completion of whole years in each age band and the calculation is worked backwards, you would normally need to use a redundancy calculator to get the exact figures.  The most reliable calculator is the government’s calculator at: www.gov.uk/calculate-your-redundancy-pay

For more information on your employment rights contact Karen Bulfin at Bulfin & Co on 0208 866 0044 or by email: karen@bulfin.co.uk