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Effective Date of Termination of Employment

The Court of Appeal has confirmed, in the case of Gischa Cyf –v- Barratt, that the effective date of termination of an employee’s employment is the day on which the employee reads the letter informing him/her of their dismissal.

The effective date of termination is important as it is the start date for calculating when an employee can bring an employment tribunal claim. Whilst in most unfair dismissal claims the employee needs one year’s continuous service he/she must also lodge their claim within 3 months of the effective date of termination.

The case establishes that the effective date of termination does not take effect until the employee has been informed of dismissal. Often employers send letters of dismissal in the post in the hope that employees read them. This is risky, especially if an employee is nearing their first year anniversary and the employer has decided to terminate employment prior to the employee gaining unfair dismissal rights. Even a letter sent by recorded delivery does not mean it will be read the next day or shortly thereafter. What if the employee is on holiday, for example? The dismissal will not take effect until the employee has read the letter, which may mean the employee obtaining unfair dismissal rights if there is a delay.  The employee will also be able to claim ongoing pay and benefits until the date dismissal takes effect

In order to minimise this risk, following the short adjournment after any meeting at which dismissal is contemplated, it would be sensible to advise the employee of their dismissal and confirming their last day of employment (i.e. that day). Alternatively, in the absence of a meeting, dismissal might be notified by telephone.  Employers should advise that the dismissal will be confirmed in writing, together with the right of appeal and the position regarding any outstanding pay and benefits.