The decision of the Supreme Court in the recent case of Newcastle Upon Tyne NHS Foundation Trust v Haywood is one which is of relevance to all employers. The question it addresses is a simple one: when is notice of termination deemed to be given to an employee?
The facts are that Ms Haywood was told she was at risk of redundancy in April 2011. She turned 50 on 20 July 2011, redundancy after her 50th birthday would have entitled her to a much more generous pension than redundancy before that date. Ms Haywood was contractually entitled to receive 12 weeks’ notice, but her contract was silent about how notice was deemed given.
On 19 April 2011, Ms Haywood went on holiday. On 20 April, her employer sent written notice of the termination of her contract by recorded delivery and by ordinary post. She did not receive it until her return from holiday, on 27 April when she read it. If notice was deemed to be served on that date then the termination would only take effect on 20 July 2011.
The majority of the Supreme Court held that the notice was only deemed effective when it was read by the employee (or when she had a reasonable opportunity to read it). Thus it was not deemed effective until 27 April which meant that she was contractually entitled to the enhanced pension.
Crucial to the finding in this case was that there was no provision in the contract of employment to state when notice was deemed to be served. A simple clause in the contract to the effect that “notice is deemed to be served two working days after post by first class post” would have been sufficient and would have saved the NHS Trust a considerable amount of money. All employers should take note.