Employment Briefing May 2011

When does an employment contract terminate?

The Court of Appeal has revisited the thorny question of the point at which an employment contract terminates for common law purposes. In Societe Generale v Geys the Court overturned the High Court's decision that termination of employment only became effective when the employee had knowledge of it. The Court held that notification to the employee was irrelevant. This was a contractual issue and the termination was effective when notice monies were paid into the employee's bank account. It should be noted that for statutory purposes, the effective date of termination is the date on which the employee becomes aware his employment has terminated. For policy reasons, the employee's knowledge is also critical because that is the date from which time runs when calculating the tight statutory timelines for bringing an employment tribunal claim.