Notice Periods; Should You Pay Them Out?

When an employee is leaving your business, whether through resignation or being terminated by the employer (for whatever reason), it is always worth considering whether you let the employee work out the notice period or ask them to leave straight away and pay them in lieu of notice.

Obviously, this will depend upon the employee and the reasons for leaving but an employer should always bear in mind the problems a disgruntled employee can cause the business.

These risks include workers compensation claims, bullying or harassment of other staff, abusing clients or customers, interfering with computer programmes, damaging plant and equipment, sabotaging product, etc.

The writer was involved in a case where an employee working out the notice period decided it was a good time to king-hit the security guard he hadn’t got on with on the basis the employer couldn’t sack him twice.

As the employer you have to weigh up whether the risks are greater than the known costs of paying out the notice period and having the employee leave straight away.

In many of our contracts of employment provided to members we address this situation by providing that the employer can pay out the notice period and/or put the employee on what is often called ‘gardening leave’ wherein the employee is still employed and paid but is not required to attend at the workplace or undertake tasks, or alternatively, is provided with limited tasks to do during the notice period.