Ending Employment

About resignations, dismissal, settlements agreements and other terminations (see redundancy for termination by reason of redundancy).

It is often at the end of employment that things can go wrong, and this is when you need choices and options. Making your rules clear around what may happen at the 'the end' of employment essential, and this should be covered in your contract of employment.

Employment can come to an end in a number of ways. The most common is the employee resigning. This is normally straight forward, but there are times when a resignation from an employee can be a sign that they may be constructive dismissal waiting to happen.

There will also be times where the company gives notice. This may be following a formal disciplinary process (covered in detail under the disciplinary section), or it may be by reason of redundancy (covered in detail under the redundancy section). It may also be as the result of a settlement agreement or for 'some other substantial reason'.

When employees leave, there are practical considerations such as final payments and holiday pay. There may be deductions to be made, equipment to return and security matters to attend to.  There may also be post termination restrictions that you want to remind employees that they are required to comply with. 

Frequently asked questions

Although their contract of employment may end on a specified age of company retirement i.e. 66 if the colleagues wish to continue to work past this date the employer must give careful consideration to this. to terminate the employment employers would need to ensure

(i) it is objectively and reasonably justified by a legitimate aim, and
(ii) the means of achieving that aim are appropriate and necessary.”

Essentially the law is now that compulsory retirement ages set by employers must be capable of objective justification both by the existence of a legitimate aim and evidence that the means of achieving that aim is appropriate and necessary. Examples of what constitutes a legitimate aim by an employer may include:

• Intergenerational fairness (allowing younger workers to progress);
• Motivation and dynamism through the increased prospect of promotion;
• Health and Safety (generally in more safety critical occupations);
• Creation of a balanced age structure in the workforce;
• Personal and professional dignity (avoiding capability issues with older
employees); or
• Succession planning.

Employers must fairly consider requests from colleagues that wish to remain in employment past their contracted retirement date, or, they must prove that they were justified in retiring the colleague at that time. Companies should have a robust retirement process and policy which is followed to ensure clarity and fairness. Where a retirement is 'forced' rather than welcomed employers should seek advice in relation to the process to be followed.  

More information on retirement process and legislation can be found on www.irishstatutebook.ie

If an employee leaves without giving notice, they are, strictly speaking, in breach of contract.  You could therefore sue the employee for any loss arising from this breach. In reality, this would be time-consuming, costly, and it may not be easy to qualify your losses.

The best way to try to avoid this is to have contractual clauses that discourage this. For example, you can state that any holiday entitlement in excess of statutory will not be paid (you must pay statutory holiday). If you pay any bonuses or commission, you could confirm that entitlement is subject to them complying with any notice period requirements if they leave.

You should also have a clause in your contract confirming that an employee will not be paid for any period of notice not worked. 

The notice period will be in accordance with the employee's contract or alternatively the statutory notice of one week for each completed year's service, up to a maximum of 12 weeks (whichever is the greater). Please see the notice page for further guidance.

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