UK law on notice periods: What employers should know

Navigating the end of an employment relationship is one of the most sensitive tasks for any employer. Get it wrong and you risk legal challenges, team disruption and damage to your reputation. Get it right, and you ensure a smooth, professional transition that protects everyone involved. Central to this process is the notice period, a fundamental component of UK employment law that’s often misunderstood.

Here, we cut through the complexity and break down the essentials of the UK law on notice periods, moving beyond legal jargon to give you the practical knowledge needed to act confidently and compliantly.

What is in this factsheet?

This resource is your definitive guide to managing notice periods effectively. We’ll cover the critical differences between statutory and contractual notice, explain your obligations around pay and clarify complex scenarios like redundancy, garden leave and payment in lieu of notice (PILON). Think of this as your playbook for handling employment terminations with clarity and control.

In this factsheet, you’ll learn how to:

• Understand the difference between statutory and contractual notice.
• Navigate your legal obligations around notice pay.
• Manage complex situations like redundancy, garden leave and PILON.
• Apply best practices for clear and compliant employee exits.

Let’s begin by establishing exactly what a notice period is and the crucial role it plays.

What are notice periods?

A notice period is the length of time that an employer or employee must give to the other before ending the employment relationship. Its purpose is to provide a stable transition. For you, the employer, it provides time to arrange a handover, recruit a replacement and manage the impact on the team. For the departing employee, it offers a degree of financial security while they search for a new role.

This mutual obligation is a cornerstone of fair employment practice, protecting both sides from the disruption of an abrupt departure. The length of this period is determined by law and by the terms you set out in your employment contracts.

How to decide what notice period serves you best

While the law sets a minimum, employers have the ability to define longer notice periods in your employment contracts. The right contractual notice period depends on the employee’s role, level of responsibility,  and the potential impact their departure could have on your business. For junior or entry-level positions, a shorter period of one or two weeks might be sufficient.

However, for senior leadership or highly specialised roles, a longer notice period of three, six or even twelve months is common. This gives you the necessary runway to find a suitable high-calibre replacement without destabilising operations. The key is to be strategic and proportionate, ensuring the notice period reflects the seniority and business-critical nature of the position. A clear definition of these terms from day one is a core component of any robust employment contract.

These contractual terms work in tandem with the legal minimums set by UK legislation.

What employment law covers notice periods?

The foundation of the UK law on notice periods is the Employment Rights Act 1996. This legislation establishes the statutory minimum notice that must be given, which is based on an employee’s length of continuous service. It’s the legal safety net that applies even if your employment contracts are silent on the matter.

The Employment Rights Act 1996

The amount of notice required depends on who ends the employment relationship and the employee’s length of continuous service.

When the employer provides notice of termination, the statutory minimum periods are:

• One month–two years’ service: At least one week’s notice.
• Two–twelve years’ service: One week’s notice for each full year of service.
• Twelve or more years’ service: Capped at 12 weeks’ notice.

When the employee gives notice (resigns), they must provide at least one week’s notice if they’ve worked for you for at least one month. If the employee’s contract includes a longer notice period than the statutory minimums, the longer period will apply. 

For a quick-reference summary of statutory requirements, download our notice periods factsheet.

Are notice periods enforceable for employers?

Yes, absolutely. As an employer, you’re legally bound to honour the correct notice period. Failing to do so can lead to a wrongful dismissal claim. This means you must either allow the employee to work their notice period or pay them in lieu of it, if your contract allows.

During the notice period, the employee’s contract continues in full. They’re entitled to their normal pay and all contractual benefits. It’s not a time to sideline them; it’s a period of professional handover. Proper management of this phase is critical, especially in sensitive situations like redundancy.

Are notice periods enforceable for employees?

When an employee resigns without giving the correct notice, it amounts to a breach of contract. While you can’t physically force them to come to work, you do have options. You could, in theory, sue the employee for damages if you can prove their early departure caused you a direct financial loss, for example, the cost of hiring a temp at a premium rate.

In reality, legal action is rare and often not cost-effective. The more practical approach is to rely on clear contractual terms and a consistent policy. You may withhold pay for any days not worked, but you must still pay them for the time they did work. Ultimately, the best protection is a well-drafted contract and a professional offboarding process that encourages a compliant and amicable departure.

What is the statutory notice period for redundancy?

Redundancy doesn’t change the statutory notice requirements. The legal minimums based on length of service still apply. If an employee is being made redundant, you must provide them with the same notice period as for any other dismissal.

For example, an employee with seven years of service is entitled to seven weeks’ statutory notice. If their contract specifies a longer period, such as three months, then the three month period is what you must honour. Using a clear and compliant process is vital, and our at-risk redundancy notice template can provide a solid foundation for your communications.

What is garden leave?

Garden leave is when you instruct an employee not to attend the workplace or perform their duties during their notice period, while still remaining employed and on full pay. They stay on the payroll and continue to receive all contractual benefits,  but are typically excluded from day-to-day operations. Employers use garden leave strategically, often for senior or client-facing employees leaving to join a competitor. It keeps them away from sensitive information, clients and colleagues during a critical transition period, effectively de-linking their departure. Importantly, while on garden leave, the employee remains bound by all contractual obligations, including confidentiality and good-faith duties.

To rely on garden leave, it should be clearly set out in the employment contract. Without a specific clause, placing an employee on garden leave could be treated as a breach of contract, since it effectively prevents them from working. A well-drafted garden leave clause gives you flexibility to protect the business while staying compliant. When you decide to invoke garden leave, always confirm the arrangement in writing – outlining how long it will last, what pay and benefits apply, and which contractual obligations remain in force.

What is PILON (Payment in Lieu of Notice)?

PILON is when you terminate an employment contract immediately and make a payment to the employee to cover the salary and benefits they’d have earned during their notice period. This is different from garden leave, as employment ends straight away.

To use PILON, you must have a specific clause in the employment contract that gives you the right to do so. Without this clause, making a payment in lieu of notice is technically a breach of contract. PILON payments are subject to tax and National Insurance just like a regular salary. For a full breakdown, our guide to Payment in Lieu of Notice offers a deep dive.

Are there any exceptions or extra considerations?

Yes. The most significant exception to requiring notice is summary dismissal for gross misconduct. If an employee has committed a serious breach of their contract, such as theft, violence or serious insubordination, you can dismiss them instantly without any notice or payment in lieu. However, you must conduct a fair and thorough investigation and disciplinary process before taking this step.

Other considerations include enhanced contractual rights, which may offer more generous notice periods than the statutory minimum, and specific agreements made during settlement negotiations.

When might you want to offer pay in lieu of notice?

Even with a garden leave clause, sometimes a clean, immediate break is better for the business. You might choose to use PILON if:

• An employee’s departure is causing disruption or low morale.
• You want to protect confidential company information or client relationships with immediate effect.
• The role is being made redundant, and there’s no meaningful work for the employee to do during their notice period.

Using PILON provides finality and allows both parties to move forward quickly.

Common notice period issue examples

Scenario 1: The disputed pay

An employee resigns with four weeks’ notice as per their contract. During the notice period, they continue to work but only complete the bare minimum. Frustrated, the employer decides to only pay them for half of their notice period, arguing they didn’t work properly and their performance didn’t justify full pay

• Outcome: The employee could bring a claim for unlawful deduction from wages. They’re entitled to their full pay during the notice period, provided they’re willing and available to work.

Scenario 2: The abrupt resignation

A senior developer resigns without providing any notice to join a competitor, leaving a critical project unfinished. To keep things on track, the employer had to hire a contractor at double the usual cost to complete the work.

• Outcome: The employer could claim breach of contract and, in theory, seek damages for the extra cost incurred. In practice, they may choose not to pursue legal action given that the cost and effort often outweigh the potential recovery.

Scenario 3: Redundancy and PILON

A company makes a role redundant and has a PILON clause in the employee’s contract. They pay the employee their notice pay and end the contract immediately.

• Outcome: This is a clean and compliant termination. The employee receives their full entitlement, and the business can move on without a protracted notice period.

Advice for employers

• Be proactive: Don’t rely on statutory minimums. Implement clear, role-appropriate notice periods in all your employment contracts.
• Be consistent: Apply your notice period policies fairly and consistently across the organisation to avoid claims of discrimination.
• Be clear: Ensure your contracts have well-drafted clauses for garden leave and PILON to give you maximum flexibility.
• Automate to mitigate risk: Managing final pay, holiday entitlement, and notice calculations manually is high-risk. Using integrated systems helps ensure payroll compliance. Understanding the benefits of payroll automation is key to de-risking this process.

When in doubt, don’t guess. The complexities of employment law can be significant. Our HR advisory services can provide the expert guidance you need to navigate difficult situations.

Download the full factsheet

Managing notice periods is a foundational part of compliant and strategic HR. Getting it wrong creates risk, while getting it right reinforces your reputation as a fair and professional employer. Take control of the process.

For detailed templates and sample letters to use in your business, download our comprehensive factsheet.