What is a notice period?

A notice period is the amount of time between notification of a person’s departure or dismissal and their last day at work. The notice period applies to employees and employers. Someone who intends to resign should inform their employer in advance, and an employer should notify a team member before terminating employment.

In the United States, employment relationships are at-will by default: Employers and employees can end the relationship for any legitimate reason. Because the at-will system can feel insecure, most companies use employment contracts that define the terms and conditions.

British law also requires employees and employers to notify the opposite party of departure or dismissal—the length of the notice period depends on the duration of the employment period. However, an employment contract is still essential to determine the correct procedure for the notice period. 

What are the different types of notice periods?

There are a few types of notice periods since they differ based on employment circumstances:

• Statutory. The legal minimum amount of notice that a person or organization needs to give before resignation or dismissal.
• Contractual. A notice period that’s specified in an employment contract and can exceed statutory requirements, if any.
• Probationary. A person on probation tends to receive a shorter notice period, or none at all.
• Payment in lieu of notice. An organization may not want or need a person to work through their notice, allowing them to leave immediately and paying them the equivalent salary for the period.
• Garden leave. Paying a person their regular salary to stay away from work for their notice period, temporarily keeping them as an employee so they’re unable to work elsewhere.

How long is a notice period in employment?

While a statutory notice period is the legal minimum amount of notice, this differs by country or state. 

Some countries, like Denmark or the United Kingdom, require longer notice periods depending on the length of employment and may specify the exact amount of notice.

A notice period also differs depending on the employment contract and on whether the former team member has committed gross misconduct or is on probation.

Typically, notice periods range from at least two weeks to several months, but these can be longer for senior and specialized roles to ensure a smooth transition.

Considerations for determining a notice period

When it comes to determining the right notice period, it’s important to consider how long it will take to replace a team member. This is especially the case for more senior roles where the recruitment process can take longer.

It’s also worth accounting for any projects that the departing person may be involved in when they give their notice. Too short a notice period can leave other team members in the lurch, hindering performance and productivity.

It may also take a while for a new hire to become familiar with their role. Allowing time for a smooth handover between the departing professional and new hire can reduce time to productivity. 

The right notice period balances the needs of the former team member with the needs of the company, ensuring a successful transition that keeps everyone involved on good terms.

Why should HR care about notice periods?

Establishing a notice period policy can contribute to:

• Continuous productivity
• High morale
• Healthy employee-employer relationships 
• Positive workplace reputation

In short, the notice period is common decency: It enables HR personnel to search for an appropriate candidate to fill the vacancy and departing team members to prepare mentally and emotionally for the next stage of their career.

What can HR leaders do to implement the notice period system?

HR leaders can nurture a culture that effectively uses notice periods through these tactics:

• Provide an employment contract. The employment contract should explain the notice period policy in simple language and clearly outline the obligations of the employee and employer.  
• Present incentives. Companies can consider providing severance pay or a discretionary bonus to motivate team members to notify their employer in advance. Before launching any incentive, be sure to have HR and legal professionals review the plan to guarantee compliance with local government severance pay laws. 
• Leverage performance reviews. Documenting unsatisfactory professional conduct in performance reviews enables managers to track negative behavioral patterns. Addressing a problem before it escalates allows people to improve their behavior and minimize the chances of a sudden resignation or dismissal.   
• Hone managers’ communication skills. Equipping managers with problem-solving tools helps them address issues and determine the root of the problem. Identifying reasons for dissatisfaction in the workplace can help team members decide if they genuinely want to leave their job—reducing attrition and boosting retention.     
• Demonstrate goodwill during the notice period. HR leaders can take an empathic approach when preparing to give notice. Demonstrating etiquette when notifying a professional of dismissal can lead to a kinder disengagement process between employer and employee.

What is a notice period on a job application?

On a job application, a notice period refers to how much time you’ll need to work for your current employer before you’re able to sever ties with the company and move on to your new role at another organization. 

Knowing what your availability or notice period is gives time for wrapping up ongoing projects, handing over responsibilities, and minimizing any disruption to the current workplace. It also gives employers the chance to find a suitable replacement.

How can implementing a notice period improve company culture?

The notice period establishes a timeline for the termination process, enabling each side a smoother transition to the next stage. Adhering to the notice period rules reflects mutual respect towards the opposite party, an essential part of a healthy employment relationship and a necessity for a flourishing company culture.