Dealing with an employee's refusal to work their notice period can be quite challenging. For some employees, the moment they hand in their resignation is the moment they shut down.
If the employee leaving was valuable to your team due to their skills and experience, it can be frustrating to see them leave without completing their notice period. This can lead to feelings of resentment particularly if they don’t explain the reason they don’t want to or can’t work their notice.
Instead of dwelling on what could have been, let's talk about what to do if your employee refuses to work their full notice period.
What is a notice period?
When an employee decides to leave their job, they are typically required to work a notice period.
A notice period is, the amount of time during which your employee must continue to work for your business after resigning, being dismissed, or being made redundant.
How much notice your employee has to give depends on:
how long they have worked for your business
what's in their employment contract
whether your employee resigns, you dismiss them or make them redundant
Typically, it can be anything from one week's notice to a month's notice. However, if your employee has only worked for you for less than a month no notice is required unless stated in their contract and if they have worked for you for over a month, they must work a notice of one week or more depending on their contract.
Some companies choose to have long notice periods, but you should note that having a shorter notice period could benefit your business depending on the role and handover required.
Statutory notice periods vs contractual notice periods
The statutory notice period for an employee who resigns is one business week—if that is, they've been working for you for one month or more. This is true of employees who are on their probation period, too.
For example, if someone gives you their one week's notice on a Monday, their last day of that 'one week' is the next Monday.
A contractual notice period, on the other hand, is at the discretion of the employer—as long you have issued your employees with employment contracts that states the notice period. However, if the amount of notice required is not in their employment contract, they are required to work a statutory notice period.
For this reason, it's common for many businesses to write into contracts notice period requirements. It's important to note that even if your employee does not sign their contract, they are still required to adhere to the notice period in their contract.
The employment contract
If the contracts you offer have long notice periods, you might actually deter new talent from wanting to join you. When someone decides to leave your business, they may not be able to or want to work a long notice.
Our advice is to be smart with your working notice periods and lengths. Set each one according to the level of seniority of the role someone is in. Make sure that their employment contract is clear about working notice periods, and that all clauses are easy to understand. A hard-to-read contract will only cause confusion and problems in the future.
It's important to remember that as an employer, ideally, you want the employee's contract to be signed by both parties and be easily available to your staff to ensure they understand the length of the statutory notice period they are obliged to give. However, as mentioned above their contract still stands whether they sign it or not.
Do employees have to work notice periods?
Simply put, yes.
Employees will normally be contractually obligated to work their notice period for any of their employers. But sometimes it's not that simple.
There're circumstances where your employee might not be able to work their notice period. For example, your employee might have an immediate start date at their next job.
If you decide to allow the employee to leave without working their entire notice period, you should confirm in writing that you have released them from their notice period early.
This ends their employment contract and means you won't have to pay them for the unexpired part of their notice period.
Do you need to pay an employee who refuses to work their notice period?
If an employee does not work their notice period, as the employer you are not legally required to pay them for this time. This is because it's now a breach of their contract. It is however recommended to include this in your employment contract to prevent disputes in the future.
It's important to note that you will have to pay them for their usual benefits earned up to the last day that your employee worked, for example, their pension contributions or paid holiday entitlement.
Not working notice period breach of contract
When staff sign their contract or are issued their contract, they have a legal requirement to fulfil their notice. Of course, this doesn't always happen.
If you have an employee refusing to work their notice period, your employee has breached their contract and you can take legal action.
For example, you can take them to court to claim damages that your business has suffered because of them not working their notice period. However, you should do this as a last option.
Damages such as financial loss are not easy to prove. You would need to explain, thoroughly and have supporting documents that go into detail about any profits lost, and any costs for hiring cover staff. You should also note that a court is unlikely to force staff to work their notice period.
If your employee refuses to work their notice—as mentioned before, they’re still entitled to full pay for work they've done up to the last day that they work. This includes any money owed for untaken paid holidays and taken paid holidays in that time.
Sickness and absences
Following resignation, if your employees can't work because they're sick, their pay might be impacted.
If their notice period is the same as statutory or less than a week more than statutory, you employee is entitled your employee is entitled to receive full pay throughout their notice despite being absent due to sickness or injury.
However, if their contractual notice period is longer than statutory by a week or more, they are entitled to the appropriate pay for the reason they're off, for example, statutory sick pay (SSP). This sick pay will be their regular rate of pay for sick leave.
What if you don’t want the employee to work their notice period?
In some cases, it might just be better to accept that the worker wants to leave with immediate effect. Perhaps they feel let down by the job or company after a disagreement with a colleague or something has happened in their personal life.
If you can replace the employee with ease, feel that they underperformed or they are leaving for a competitor, it might just be better to agree with them to leave.
Waiving the notice period
If you do think it's in your best interests, you might try to agree with your leaver to waive their notice and end the contract with immediate effect. You wouldn't need to pay them for their notice in this case.
Ensure that both parties sign any agreement—this way, you can avoid a later claim for unpaid wages and protect yourself from a breach of contract.
If the employee was working on an important project before they gave you their notice, you might offer them an early notice termination if they finish the project to the high standard you want.
Once an employee hands in their notice, they normally want to leave as soon as they can. If you keep this in mind and negotiate with them, they will realise you're trying to create a situation that's best for both parties.
Compromising is a sign of a strong employer, after all.
When an employee leaves to work for a competitor, some businesses may not want them to work their notice period to avoid sensitive information being put at risk.
If you decide to not have your employee work their full notice period, you can place them on garden leave, or use pay in lieu of notice, if stated in their contracts.
What is garden leave?
Garden leave is when you pay your employee their normal pay for their notice period, but they do not need to work during this time. This can protect sensitive commercial information from being taken to a competitor.
What is Pay in lieu notice (PILON)?
With a PILON clause, you can end the employment before your leaver works their notice period. However, the employee is entitled to receive their notice pay with their final salary. This also ends the employment contract and employment relationship immediately rather than after the contractual notice period.
It's important to note that you must make sure you have the contractual rights to pay in lieu of notice and that this agreement is put in writing.
Get employment law advice from BrightHR
If you're unsure about your legal requirements regarding notice periods, it's in your best interest to consult an employment law expert. Especially if you find yourself in a position where you need to take legal action or if there has been a breach of contract.
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