I understand that an employee’s employment officially ends on the effective date of termination. This is defined in the Employment Rights Act 1996 as:
- The date on which the notice period expires (if either the employer or employee gave notice to terminate the employment)
- The date on which that termination takes effect (if the employment terminates without notice).
The exact date the employment comes to an end is important:
- In order to calculate the length of service to establish whether an employee has statutory rights for example redundancy pay or unfair dismissal.
- To calculate whether an employee has brought his or her claim to the Employment Tribunal in time. Most claims must be brought within three months of the date the employment comes to an end.
- Where the employee has a contractual entitlement to a payment (e.g. bonus or commission) provided they are in employment on the date of payment.
Our organisation records the end of employment date and the last working day. So with the following example:
- We have an employee on a permanent contract.
- He resigned on:14 March 2016
- His notice period is: one month
We agreed for him to have his induction with the new employer on 4th to 6th April and in exchange he would come back and induct the new member of staff (date to be confirmed when recruitment complete). He will not be paid for these days until they have been worked.
Does that then make his 'end of employment date' and his last working day the date when he comes back to do do the induction even though that is beyond the one month notice and at this point is unknown?
Many thanks
Sarah
Replies
Hi Sarah
In terms of EDT I would expect that to be on the date when notice expires, payroll can then process as a leaver and issue the P45. Perhaps you could treat him returning as if he were a casual worker coming to do a one off piece of work, otherwise the employee would be accruing holiays etc to an unknown point. Alternatively could you pay him for the days now as an ex gratia payment and then rely on goodwill that he will return to handover to the employee?
Also I would check with the payroll people, I know then can still make payments even after the P45 has been issued.
All the best
Sarah
Hi Sarah,
My understanding is that if the employee will be paid for the extra days worked (to provide handover) then the last day would need to be the last day actually worked, not the date one month from resignation. Meaning he would not be P45'd until after he has provided the handover - the interim being left as unpaid leave so that he's only paid for the days actually worked.
Seems like this might get a bit muddy - is it at all feasible that during the notice period the employee is required to work on creating/developing suitable handover materials so that he doesn't have to come back and last day is absolutely 13 April?
Many thanks
Becky