An employee resigns but refuses to work their notice period. Can they be fired for breach of contract? Martin Brewer, partner and employment law specialist at Mills & Reeve, and Esther Smith, partner at Thomas Eggar, offer legal advice.

The question:
An employee in a sales position, who has been with us for less than six months, has handed in his resignation and told us he won’t be working his full two months’ notice period, as he has another position lined up.

His line manager, fearing a possible negative impact on potential customers, wants to ask him to leave straight away, using the clear, planned breach of contract as the reason.

Given that the employee has less than 12 months service, and has indicated that he intends to breach his contract, I assume that we would be within our rights to ask him to leave now.

John Gardiner

Legal advice:

Martin Brewer, partner and employment law specialist, Mills and Reeve

John, if this employee has in fact handed in his notice then he is already working out that notice. Assuming he is part way through his notice period your question is whether it is sensible (and I suppose legally permissible) to bring the employment to an end sooner then the expiry of the two month notice period on the basis that the employee claims that he will not work out his full notice.

I think that there is a better way to deal with this as I doubt this suggestion of not working out the notice will be in writing and you run the risk of a claim for breach of contract if you terminate the employment before the notice period runs out.

Why not simply stop this employee from seeing customers or targets for the balance of his notice period and instead ask him to do other work which whilst commensurate with his status is not customer facing? He could, for example write customer profiles, he could research potential customers, he could undertake a handover of customers to identified team members etc.

Now strictly, as a matter of contract, you may not have the express right to do this but what is the risk? The most you would have to pay is the balance of the notice pay anyway. You should be careful to change computer passwords and keep the employee away from sensitive information whilst he works out his notice but since the period we are discussing is relatively short that shouldn’t be too much of a problem.

Should the employee actually leave before the end of his notice period you would of course stop paying him at that point.

The only other thing you should consider is ensuring that any accrued untaken holiday is taken by this employee during the notice period.

Martin can be contacted at: martin.brewer@mills-reeve.com

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Esther Smith, partner, Thomas Eggar

Unfortunately, for employers this is a common problem! However, if you as the employer indicate to the employee that you do not require him to work his notice period, technically you are terminating his employment (as although he has served notice the employment would be on going until the end of that notice period) and therefore would be obliged to pay him for his period of notice under the contract. However, if you wait for him to go, or indeed if he has already confirmed the date he will be leaving on, then you only need to pay him up to the last day he works.

Many employers wish to take action against an employee who has resigned in breach of contract and not given the full notice requirement. In theory this is possible as the employee is in breach of contract and that is actionable by the employer, although in reality there is no point suing for a breach of contract unless you can demonstrate a loss associated with that breach. As any losses the employer may suffer will be off set against the money that it will save on the unpaid wages it is often impossible for an employer to demonstrate that they have suffered a loss, or certainly a loss that is worth litigating.

Esther Smith is a partner in Thomas Eggar’s Employment Law Unit. For further information please visit Thomas Eggar