If your employer has not given you the correct notice to end your employment – or failed to pay you for it – then they are in breach of contract and become liable to pay you damages for wrongful dismissal.
The damages you can recover will include wages and other benefits that would have been yours during the notice period, such as pension entitlement, private health cover, car allowance and any bonus.
If you have been dismissed as a result of gross misconduct, and your employer was justified in dismissing you in this way, you cannot claim wrongful dismissal.
What notice am I entitled to?
If notice was never discussed – and it’s not uncommon for employees to have not received a written contact -then the law implies some minimum notice periods for you. Whatever your contract says, you can never be entitled to less notice than what statute says. These minimum periods are:
- If you have worked between 1 month and 2 years – you are entitled to 1 week’s notice from your employer
- If you have worked between 2 and 12 years – you are entitled to 1 week for every year worked up to a maximum of 12 weeks
The above periods are just a minimum. If your employment contract gives you more than statutory notice, then you will be entitled to receive the notice for the longer period.
In some circumstances you may be able to argue that you are entitled to more than the statutory minimum. What is reasonable in the circumstances will depend on your industry and your seniority.
What is Pay in Lieu of Notice (PILON)?
This is where you are paid for your notice without having to work it. This is often referred to as ‘PILON’. Most employment contracts contain a PILON clause.
Your contract may also say that you are not entitled to be paid for benefits such as car allowance, pension, or private health insurance where you are paid in lieu of notice. In other words, you receive just your basic salary. You would usually pay PAYE and National Insurance on your notice pay.
Where you have no PILON clause in your contract but your employer decides nevertheless to pay you in lieu, they are technically in breach of contract. They should include all the other benefits that you would have received during the notice period, such as pension rights, health cover and holiday pay, to put you in the same position that you would have been in if you had worked your notice. Some of the payments would not be subject to tax and National Insurance as they are treated as damages.
If you have restrictive covenants in your contract of employment, and your employer pays you in lieu of notice without having that right in the contract, you may be able to claim the restrictions on you don’t apply. You should take expert legal advice first before relying on this.
What damages can I receive?
The amount of damages for wrongful dismissal is based on your pay and other benefits.
How do I recover the money I am owed?
A threat of legal action from us will usually be enough. We have a lot of success in achieving a speedy payment for a guaranteed fixed fee. If your employer is still refusing to pay then you can bring a claim in a County Court or start the mandatory Acas Early Conciliation process before issuing an Employment Tribunal claim.
How long do I have before bringing a claim?
Most claims settle. You must have commenced the mandatory Acas Early Conciliation process within 3 months (less one day) from the date the wages were owed to you – usually when your employment ended.
A claim for breach of contract in the County Court has a time limit of six years from the date of non-payment. We will explain where the best place to bring a claim is.
What do I do now?
This is where we come in. Employment law is all we do.
It can often feel like your employer holds all the power. They will likely have experienced HR professionals or a solicitor working in the background. That’s why you need the best support and advice available. You need a specialist employment lawyer – one who will push for the best outcome for you.
We understand how it feels. We have helped hundreds of employees and because we act for businesses too, we know the tactics you’re likely to face from your employer. We know all the tricks in the book.
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