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Notice Pay & Gross Misconduct

29/05/2012

In the recent case of Cavanagh v William Evans Limited, the Court of Appeal considered whether it was possible to withhold a payment in lieu of notice when it had been later discovered that an employee committed an act of gross misconduct.

In this particular case, an employee was dismissed by reason of redundancy. The employer terminated the employment with immediate effect and was to make a payment in lieu of the notice period, in accordance with an express term of the employment contract.

Following the dismissal, but prior to making the payment in lieu of notice, the employer discovered that the employee had committed an act of gross misconduct during his employment. As a result of this discovery, the employer did not make the payment in lieu of notice.

The Court of Appeal decided that this approach was not lawful as, even though the employee may have committed an act of gross misconduct, he had already acquired the right to the notice payment by virtue of the redundancy. There was no provision in the employment contract that permitted the employer to withhold the notice payment upon subsequent discovery of gross misconduct, and as a result the payment was rightfully due.

KBL are able to advise and assist employers in relation to all aspects of dismissals, including issues relating to notice periods.

If you require advice or assistance in respect of the above or any other employment matter, please call or email John Hassells, Head of Employment on 01204 527777. John Hassells

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