P is for PILON

Date published: 7th January 2021


Notice period and pay

When and employer dismisses an employee, they should give them notice of when their job will end.

In most cases, the employee will carry on working on until the end of their notice period.

How much notice they get depends on 

  • How long they have worked for their employer
  • What is in their contract of employment

How much notice should an employee get:-

If you have worked for your employer for

  • 1 month to 2 years – the minimum notice is one week
  • 2 to 12 years – maximum is 1 week for every year worked
  • 12 weeks or more – the minimum notice is 12 weeks.

Client should also check their contract of employment as it may be different this is “Contractual Notice”

  • An employer can give more that the statutory notice, but not less.


  • If contractual notice is less than statutory notice, employee must get statutory notice
  • If the contractual notice is higher than the statutory amount, the employee is entitled to the contractual notice

Leaving during the notice period

Should the employee want to leave during the notice period they will need to ask their employer.

Any agreement should be in writing.

If an employee leaves early their employer does not need to pay them for the full notice period.

Pay in lieu of notice (PILON)

An employer can give an employee PILON. This means getting paid instead of having a notice period and stop working for their employer straight away.

Employee should check their contract of employment for any work benefits during the notice period.

An employer can still offer payment in lieu of notice if it is not in the contract. This should be agreed between the employee and the employer in writing.

When not in the contract it would be a good idea for the employer to offer full pay including usual work benefits. If the employer doesn’t do this it could be seen as breach of contract.

The employer should give in writing to the employee the date their job comes to an end. This could prove to be important if there is nothing about PILON in their contract of employment.

*Furlough and Notice Pay*

If an employee is dismissed whilst on furlough their employer can still claim payments from HMRC during the notice period.

If they have a statutory notice period, notice pay must be at the employees normal rate, even if they have getting paid at the reduced furlough rate*.




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