Employee Notice Period: Meaning, Importance, and FAQs

Every employee plays an integral role in your business, and when they leave, transitioning their work to their replacement can be difficult. That’s why companies use notice period policies ‌to build in time for an effective transition.

Notice periods are an important part of your company’s offboarding process. Yet 71% of organizations don’t have a formal offboarding process, which can lead to employees departing without much warning or without an understanding of best practices for how they exit. 

Discover what notice periods are, why they’re important, and how to manage employee exit periods and transitions in your organization.

A notice period is a set amount of time that an employee must provide before leaving their job. The standard is typically two weeks, but this varies by employer. Notice periods serve two main purposes: giving the employer time to start finding a replacement and giving the employee time to tie up loose ends and complete offboarding procedures. 

During the transition period, the employee usually continues to perform work, although their duties may be reduced or restricted. Notice periods are a common component of employment contracts, and employees should be aware of any applicable notice period.

Notice periods apply to employers, too: In many places, employers are legally obligated to notify workers before their final day of work.

Employers require a notice period for a variety of reasons. First, it allows the employer to start recruiting for a replacement before the current worker departs. This reduces the operational disruption caused by the employee’s departure. Second, it allows the employee to give proper notice before leaving, finish key tasks and projects, and transfer any knowledge, responsibilities, and equipment.

Third, the notice period provides the employer with time to prepare paperwork for the employee, update job descriptions and contracts, and to review the role itself.

There are negative consequences of not having a policy for when employees should submit a letter of resignation. Reputationally, it can reflect poorly on both the employer and the employee. Employers may receive a negative employer net promoter score for mismanaging employee offboarding and causing disruption for remaining employees. Employees who exit without notice, meanwhile, are at risk of receiving a poor reference from former employers. 

Not having a formal policy also makes it more difficult to transfer valuable knowledge from the exiting employee to their replacement, which can have a long-term impact on performance and institutional knowledge. Notice period policies help employees exit on good terms, leaving the door open for a potential return.

Don’t leave offboarding to chance. Learn more about why last impressions count, too. 💟

In many places, employers are legally bound to provide notice of termination in advance. Check out some common types of legal requirements for submitting notices of termination to employees.

Statutory Notice Periods

A statutory notice period is a legal requirement for an employer to provide written notice to an employee before terminating their employment. This notice period is usually set out in the employment contract or by law. The length of the notice period can vary depending on the country, local jurisdiction, or type of employment. 

Generally, notice periods are between one and four weeks, although longer notice periods may be required for certain types of employment. In Australia and the United Kingdom, for example, employers must give a minimum notice period of one week for employees with tenure of two years or less. The notice period is longer for employees with more tenure at the company. The statutory notice period provides employees with time to prepare for their dismissal and seek new opportunities.

In some countries, a redundancy notice is a type of statutory notice that applies when the employer is eliminating a role. The employer must alert employees who are affected by this role elimination. 

Contractual Notice Periods

A contractual notice period is a contractually specified length of time during which either party must give notice of their intention to end the contract. This gives both parties enough time to make alternative arrangements.

Contractual notices may be longer than statutory minimum notice periods, but they can’t be shorter.

Zero-Hour Contracts and Notice Periods

A zero-hour contract is a term primarily used in the United Kingdom and means the employer isn’t legally bound to provide any set number of working hours. The contract can legally be terminated at any point. 

Although zero-hour contracts aren’t bound by statutory notice regulations, it’s ‌good practice for employers and contract workers to come to an agreement on one when possible.

Human resources plays an important role in developing and managing employee offboarding processes, including notice periods. Here are some of your top responsibilities as an HR leader for supporting employee exits and transitions through effective notice periods.

Creating Clear Policies

HR can set clear notice periods by considering the company’s needs and applicable laws. HR should ensure that notice periods are reasonable and appropriate for the employee’s position. Generally, the greater an employee’s responsibility, the longer the notice period needs to be to make sure their institutional knowledge and role-specific expertise are transferred to the institution or their replacement. A store manager, for instance, should give more notice than a sales associate.

Communicating Policies to Employees

HR is responsible for making sure all employees are aware of and understand the company’s notice period policies. Workers should also be familiar with the process for giving and receiving notice. Communicate your policies through a formal document, such as your employee handbook, and reinforce them through verbal communication.

Coordinating the Transition

HR is responsible for developing processes to secure important job information and institutional knowledge from the exiting employee. Typically, the departing employee bears responsibility for training their replacement, but HR should oversee the transition and work with managers to ensure this transition process goes smoothly.

Conducting Exit Interviews

An exit interview is a formal discussion between an employer and an employee who is leaving the organization. The purpose of the exit interview is to gain an understanding of why the employee is leaving and to identify areas of improvement for the organization. HR is responsible for leading the exit interview process and obtaining feedback from the employee.

Much like onboarding automation, you can use HR workflow software to plot out and automate the offboarding journey, from the beginning of the notice period to a worker’s final day of employment. An employee’s notice period submission can trigger the offboarding workflow, notifying the manager and HR and kicking off the next steps in the transition. 

Established workflows keep everything organized and direct all parties to follow the correct processes in the right order. For example, clear instructions delivered via workflow software tell exiting employees where to return company equipment and alerts IT to revoke their access to software, databases, and other company access points.

Notice periods are an important part of the employee life cycle. Review some of these frequently asked questions to make sure your notice policies are the best they can be.

How Do You Ensure a Smooth Handover Process During an Employee’s Notice Period?

Provide the replacement employee with a detailed plan of what needs to occur, including the tasks to be completed and other relevant information. Make sure they have access to relevant resources, such as training materials or manuals, to ensure they can complete their tasks efficiently. 

If possible, during the transition period, have the exiting employee help train and mentor their replacement.

How Do You Communicate an Employee’s Exit to the Rest of the Workforce?

Start by alerting the exiting employee’s immediate team and other people whose work will be most affected by the change. Have the manager tell the team individually, when possible, so they can ask questions about what it means for them. From there, communicate the news to other teams who may also be affected by the transition.

How Do You Use an Employee’s Exit Period to Gather Insights for Improving Retention?

The most important step in gathering insights during the notice period is to ask the right questions. Employers should ask the employee to provide specific details about why they are leaving, including issues with the job, company culture, or team dynamics. 

The employer should also ask the employee for feedback about the organization, including areas of improvement. Employees who engaged in “quiet quitting” before submitting their resignation, for example, might be willing to share what led to their disengagement

What Is a Notice Period on a Job Application?

A notice period on a job application is the amount of time a candidate must give their current employer before leaving their job to accept a new position. This period is often between two weeks and one month, but it can vary depending on the company’s policies and an employee’s comfort level. 

When making a job offer, be sure about the candidate’s intended start date. This timeline will affect how you plan for filling the position, onboarding the new employee, and adjusting your operations accordingly.

Saying goodbye to an employee is never easy, but notice period policies and offboarding processes can make the experience easier for everyone. Don’t leave employees guessing when and how to tell their manager that they’re leaving. Spell out your best practices to deliver a positive employee experience right up to their last day.

Find out how Enboarder supports employee transitions at scale.