Supreme Court on when notice of termination takes effect
Thursday 3rd May 2018
In Newcastle Upon Tyne NHS Foundation Trust v Haywood the SC has held that, in the absence of an express contractual provision stipulating when notice is deemed delivered, notice is only effective when an employee has read or has had a reasonable opportunity to read it.
Mrs Haywood was told on 1 April 2011 that she was at risk of redundancy. On 18 April 2011, she began her pre-booked annual leave, flying to Egypt on 19 April 2011. She returned home on 27 April 2011. On 20 April 2011, the Trust wrote to Mrs Haywood confirming her redundancy, giving 12 weeks’ notice that her employment would terminate on 15 July 2011.
Mrs Haywood’s contract did not stipulate when this notice was deemed to be effective from. This point was important for Mrs Haywood. If her redundancy took effect after she was 50 on 20 July 2011, she would be entitled to a more generous pension.
The SC had to ascertain the appropriate implied contractual term as to when notice was effective. The Trust argued for the application of a common law rule found in historical landlord and tenant cases, providing that notice is given when a letter is delivered to the relevant address, regardless of whether or not it has been read. Mrs Haywood argued that notice was not given until she read the Trust’s letter on 27 April 2011, when she returned home, meaning it had expired after she turned 50.
A 3:2 majority of the SC held that, in the absence of an express contractual provision, notice is effective when an employee has read or has had a reasonable opportunity to read it. The SC considered that the case law from the EAT was clear and consistent. A distinction was to be drawn between delivery to a commercial entity during business hours, where paid staff are on hand to receive mail, and delivery to a person’s home. Here, the Trust’s notice was not effective until Mrs Haywood read the letter after returning from her holiday.
All information in this update is intended for general guidance only and is not intended to be comprehensive, or to provide legal advice.