Notice periods can sound simple, but can be technically very difficult. An employee resigns on a Friday, a redundancy consultation wraps up, or a probation review does not go to plan, and suddenly the question is this: how much notice is owed, by whom, and what has to be paid?
Getting it right keeps an exit clean, professional and defensible. Getting it wrong can turn a routine departure into a breach of contract claim. This guide walks through the essentials for employers, from the legal minimums to the practical traps that catch people out. For the underlying guidance, we have drawn on the current Acas guidance on notice periods.
What is a notice period?
A notice period is the time between someone confirming they are leaving, or being told they are being dismissed, and their employment actually ending. From a legal perspective, it is the notice either party gives to terminate the contract they have entered. It gives both sides time to prepare, whether that means handing over work, recruiting a replacement or simply parting on good terms.
There are two layers to keep in mind: the statutory minimum set by law, and the contractual notice you agree with your employee. As a rule, a contract can offer more than the legal minimum, but never less.
Statutory notice: the legal minimum
If you are dismissing an employee or making them redundant, under the Employment Rights Act 1996, once someone has at least one month of service you must give:
- One week of notice for employees with between one month and two years of service.
- One week of notice for each complete year of service between two and twelve years.
- Twelve weeks of notice once service reaches twelve years or more, which is the maximum.
So an employee with four years and nine months of service is entitled to four weeks of statutory notice.
When an employee resigns, the position is simpler. Once they have worked for you for at least a month, they must give you at least one week of notice, unless their contract asks for more.
Contractual notice: where most disputes start
In practice, most contracts ask for more than the statutory minimum, often one month, or three months for senior roles. However, this only applies if it is written down clearly. An employee’s written statement of employment particulars must set out their notice period.
If your contract is silent or vague, you fall back on the statutory minimum, which is rarely what either side had in mind.
Pay, garden leave and payment in lieu
An employee is normally entitled to their usual pay throughout their notice period. In addition, you have a few options for how that time is spent:
- Working the notice as normal.
- Garden leave, where the employee stays employed and paid but is asked not to attend work or contact clients. This is useful when you want to protect relationships or sensitive information.
- Payment in lieu of notice, often called PILON, where you pay the employee for their notice instead of having them work it, and the employment ends on an agreed date. This is only legal where the contract allows it. Otherwise, it can amount to a breach of contract.
When notice does not apply
There is one important exception. If an employee is guilty of gross misconduct, you may be able to dismiss them without notice or pay in lieu, known as summary dismissal.
As a result, this carries real risk and should never be a snap decision; if its not genuinely gross misconduct the employer risks a wrongful dismissal claim. A fair investigation and process still matter, so take advice before going down this route.
It is also worth remembering that giving the correct notice does not, on its own, make a dismissal fair. Notice protects you from a breach of contract claim.
A fair reason and a fair process are what protect you from an unfair dismissal claim. They are two separate things, and employers often assume that ticking the notice box is enough.
Have notice periods changed under the Employment Rights Act 2025?
The Employment Rights Act 2025 is the biggest shake-up of employment law in a generation, and it is being introduced in stages. The first major tranche took effect on 6 and 7 April 2026. However, the statutory notice periods set out above have not changed. For more support on what these changes may mean for your business, check out our blog here!
They still sit under section 86 of the Employment Rights Act 1996, and the April 2026 reforms did not touch them.
The reforms that will really change how much notice periods matter come in on 1 January 2027. From that date, the qualifying period for ordinary unfair dismissal drops from two years to six months, and the cap on the compensatory award for unfair dismissal is removed. As a result, far more employees will be able to bring a claim much earlier in their employment, so getting notice, contracts and dismissal processes right becomes more important than ever.
One technical point is worth flagging. Where you dismiss an employee without notice, including where you pay in lieu, the statutory minimum notice is added on when working out their effective date of termination. That can push someone over the qualifying period for an unfair dismissal claim, unless the dismissal is for genuine gross misconduct. It is a small detail that can have a big effect from 2027 onwards.
The bottom line
Notice periods are one of those areas where a little care upfront saves a great deal of pain later. Clear contracts, accurate written statements and a calm, consistent process at the point of exit will keep you on the right side of the law and out of the tribunal.
How Thrive Law can help
If you are unsure how the rules apply to a particular departure, we are here to help. Our team supports employers day to day with contracts, exits and everything in between. You can explore our employment law support for employers, or browse more practical guidance on the Thrive Law blog.
To talk it through, get in touch at enquiries@thrivelaw.co.uk or call 0113 869 8101. For straight-talking employment law insight in bite-sized form, take a look at Jodie Hill’s YouTube channel.
