The Employment Rights Act 1996 sets the minimum statutory notice an employer must give to terminate an employee's contract. After one month of continuous employment, the minimum is one week's notice; this rises by one week for each completed year of service up to a ceiling of 12 weeks for 12 or more years. An employee who has been employed for at least one month must give a minimum of one week's notice to resign, regardless of their length of service, unless a longer period is specified in their contract.
Contractual notice periods frequently exceed the statutory minimums, particularly for senior roles, and are enforceable by either party. Where a contract provides for longer notice, the contractual period governs. An employer may choose to make a payment in lieu of notice (PILON) if the contract contains a PILON clause; since April 2018, Post-Employment Notice Pay is always subject to income tax and NICs regardless of whether a contractual PILON clause exists, ending the previous practice of structuring departures to achieve a tax-free payment.
During the statutory notice period, employees retain most contractual rights including pay, holiday accrual, and access to benefits. Garden leave, where the employee is asked not to attend work but remains employed and paid, is a common alternative to immediate termination where the employer wishes to protect confidential information or client relationships.