Avoid notice pay on ill health absence dismissals

An often overlooked provision is that part of the Employment Rights Act whose effect is that the employment of a long term absent ill health employee can be terminated by paying no monies in lieu of notice where the contactual notice period is at least one day longer than the statutory minimum notice period. At most this can save an employer 12 weeks' pay.

The trick is to draft the contract so as to provide that "notice of termination to be given by the employer to the employee shall be the employee's statutory minimum period of notice plus one day."

The employer still needs to be careful to follow a fair procedure before deciding to dismiss, otherwise the employee may well have an unfair dismsisal claim. In cases where the employee satisfies the definition of "disabled" under the Disability Discrimination Act 1995, the employer needs to take care to avoid a situation which might lead to a discrimination claim.