Employers who dismiss by post can be caught out – as a recent Supreme Court case, Newcastle Upon Tyne NHS Foundation Trust v Haywood, clearly shows.
Sandi Haywood, who had worked for an NHS foundation Trust for more than 30 years, knew she was at risk of redundancy when she went on previously approved holiday for a week.
Whilst she was away, her employer sent her notice of termination of her employment. This was sent by both recorded delivery and ordinary post. She opened the letter seven days later, when she returned from holiday.
The delay in opening the letter was crucial. By the time she read the letter, and taking into account her contractual notice, she had reached her 50th birthday. This entitled Mrs Haywood to a considerably more generous pension. Had she opened the letter a day beforehand, she would not have been entitled to the higher pension.
The rule is that notice of a dismissal is effective only when the employee has had a reasonable opportunity to read it, regardless of when it is sent or when it is delivered.
What should employers do?
Careful drafting of employment contracts is clearly key to providing greater certainty of when the notices they give, take effect.
It’s important to remember:
Clarity for employees
The case is a significant one for employees. Lady Hale, one of the judges who heard the appeal, said: “Given the vast numbers of working people who might be affected by this issue, it is perhaps surprising that it has not previously come before the higher courts.”
It gives a definitive answer to when the period of notice starts if an employee is dismissed in writing and posted to them as opposed to them being told in person.
Funding arrangements for litigation
Notably, Mrs Haywood was initially funded by her own legal expenses insurance then through a conditional fee arrangement with an after-the-event insurance policy for the Court of Appeal and Supreme Court.
This shows how alternative funding arrangements can be put in place to represent private individuals in relation to large organisations.