Providing for termination of the employment contract is an important term of the contract of employment, one which the employer needs to take care over, particularly the notice period.
There are a number of important considerations to think about such as
- The notice period
- The reason(s) for termination.
Notice period
An agreed notice period is strongly recommended in all contracts of employment. If none is specified then the employer is obliged to give “reasonable” notice. Reasonable notice will vary from contract to contract.
Minimum Notice Periods for termination
The statutory minimum notice periods on termination of employment are as set out in the Minimum Notice and Terms of Employment Acts 1973 to 2001 which are based on years of service of the employee.
Service Notice
13 weeks – 2 years 1 week
2 – 5 years 2 weeks
5 – 10 years 4 weeks
10 -15 years 6 weeks
over 15 years 8 weeks.
Employees are entitled to the above notice periods or pay in lieu except in cases of dismissal for misconduct where the employer is entitled to terminate the employment immediately without notice.
The employer on the other hand is entitled to at least 1 week’s notice from the employee, but this will depend on the contract.
Note: Both the employer and employee have the right to terminate the contract of employment without notice due to the misconduct of the other party.
Any claims in respect of breaches of the Minimum Notice and Terms of Employment Acts go to the Employments Appeal Tribunal which can award compensation to the employee for not receiving proper notice. (Note that if the employee was sick or on strike during the notice period no compensation is payable)
Reason for termination of the employment contract
Both employer and employee have a broadly similar right under common law to terminate the contract of employment. If notice is not provided for in the contract then “reasonable” notice should be given.
“Reasonable notice”, in the absence of a stipulated period of notice, will be decided by
- Custom and practice
- Length of service
- Age and experience of the employee
- Job role
- The particular facts of the case.
It is recommended to the employer that a notice period always be stipulated in the contract.
Giving notice of termination of employment contract
Some important points concerning notice:
- Notice can be given at any time including during leave or illness leave but not during maternity leave;
- It must be clear and unambiguous
- It can be in writing or orally (unless it is specified in the contract that it be in writing)
- The Minimum Notice and Terms of Employment Act, 1973 sets out minimum notice periods depending on the length of service
- The minimum period of notice in all cases is one week
- If an employee is dismissed for misconduct he loses his entitlement to notice under the Minimum Notice and Terms of Employment Act, 1973.
Damages following dismissal
In general punitive damages allowed following a dismissal will be restricted to remuneration to which the employee was entitled and not for any distress caused by the manner in which the dismissal has occurred.
Employers-How to Avoid Costly Employment Claims