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When is Notice of Dismissal Effective?

9th Nov 2018
Absence Management, Employment Law, Human Resources, Recruitment

An employee was given notice of redundancy but was on holiday when the letter arrived. There was a significant difference in her pension entitlement between leaving at age 49 and age 50 – which everyone involved knew about … In the case of Haywood vs Newcastle Upon Tyne NHS Foundation Trust – what happened next?

This case hinged on the date when notice of termination of employment began to run. This was important because, if the Claimant’s employment terminated by reason of redundancy on or after her 50th birthday on 20 July 2011, she would be entitled to claim a non-actuarially reduced early retirement pension. If it terminated before that date, she would not.

On 20 April 2011, the Trust issued written notice of termination of her employment on the ground of redundancy giving 12 weeks contractual notice but, as the Claimant was on holiday, she did not read it until 27 April. She claimed that the 12 weeks notice expired on 20 July, her 50th birthday, and accordingly that she was entitled to the early retirement pension. The Trust claimed that notice was given before 27 April and therefore she was not entitled to the early retirement pension.

The issue before the court was:

If an employee is dismissed on written notice posted to his home address, when does the notice period begin to run? Is it when the letter would have been delivered in the ordinary course of post? Or when it was in fact delivered to that address? Or when the letter comes to the attention of the employee and he has either read it or had a reasonable opportunity of doing so?

The Supreme Court ruled in favour of the Claimant by a majority of 3 to 2 and said the third option was correct. The EAT has been consistent in its approach to notices given to employers since 1980. The EAT is an expert tribunal which must be taken to be familiar with employment practices, as well as the general merits in employment cases.

In summary, as the Employee did not have the opportunity to read the letter before her return from holiday, EAT Case Law confirmed: upheld that notice should not start until “read by employee or the employee had a reasonable opportunity of doing so”. The notice period therefore began later than the employer intended, thereby ending on / after the employees 50th birthday allowing the enhanced pension rights to be claimed. Was the original timing an attempt by the NHS foundation to reduce costs? We may never know!

If you want to read the full judgement please click here.

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