HM Insights

Where an employment contract is silent on when notice is deemed to be given, when does notice of termination take effect?

This was the question raised in the case of Newcastle Upon Tyne NHS Foundation Trust v Haywood.

The answer was held to be when it is actually received by the employee and s/he has read it (or had a reasonable opportunity to read it).

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Facts of the case

In April 2011, Ms Haywood was told she was at risk of redundancy. She turned 50 on 20 July 2011 and if Ms Haywood was made redundant after her 50th birthday she would have been entitled to a considerably more generous pension than if she had been made redundant before that date.

Ms Haywood was contractually entitled to be given 12 weeks’ notice, but her contract was silent about how notice was deemed given.

On 19 April 2011, Ms Haywood went on holiday. Her employer was aware of this. On 20 April, her employer sent notice of termination by recorded delivery and ordinary post. She read it on her return from holiday on 27 April.

If delivery was deemed effective before 27 April, she would have received the much lower pension.

The majority of the Supreme Court held there was no good reason to disturb the long-standing line of case law from the Employment Appeal Tribunal. The notice was only deemed effective when it was read by the employee (or s/he had a reasonable opportunity to read it). The Trust's counter argument that the notice should be deemed given upon delivery, regardless of whether the intended recipient was there to receive it, was rejected.

Thus it was not deemed effective until 27 April, and Ms Haywood was entitled to the higher pension.

Practical guidance for employers giving notice

It is important to remember that this case revolves around the situation where there was not an express term in the contract of employment to determine when notice was effective.

What this might mean is that there might be a shift in employment practice whereby when an employee is given notice they are given notice in a face-to-face meeting with the letter being presented at the same time.

It was even suggested in the judgement that employers could provide more than the prescribed minimum period of notice setting out a clear end date so as to avoid ambiguity.