In Gibraltar, the Employment Act 1932 outlines the minimum notice periods that employers must adhere to when terminating an employee's contract. These periods vary depending on the employee's salary payment frequency and length of service.

Legal Framework

The Employment Act 1932 is the main legal document that governs notice periods in Gibraltar.

Minimum Notice Periods

Employee Notice Period

There is no statutory minimum notice period that an employee must provide upon resignation. However, certain employment contracts or collective bargaining agreements may stipulate a specific notice period that the employee must follow.

Employer Notice Period

The minimum notice period that an employer must provide depends on the employee's salary payment frequency and length of service:

• Monthly Paid Employees:

  • Up to eight years' service: One month's notice
  • Between eight and ten years' service: Two months' notice
  • Over ten years' service: Three months' notice

• More Frequent Pay (e.g., Bi-Weekly, Weekly):

  • Less than two years' service: One week's notice
  • Between two and five years' service: Two weeks' notice
  • Between five and eight years' service: Four weeks' notice
  • Between eight and ten years' service: Eight weeks' notice
  • Over ten years' service: 13 weeks' notice

Probationary Period

The first week of employment is considered a probationary period. During this time, either party can terminate the employment without notice.

Important Considerations

The notice period serves as a timeframe for the employee to continue working (or be placed on paid leave) and allows for a smoother handover of responsibilities. During the notice period, both the employer and employee are obligated to fulfill their contractual duties (work performance for the employee and salary payment for the employer). Exceptions to notice periods may occur in cases of serious misconduct by the employee or circumstances allowing for summary dismissal.

In Gibraltar, "redundancy pay," also known as severance pay, is a financial compensation that employers may be required to provide to employees upon termination due to redundancy. The primary legal foundation for severance pay in Gibraltar is the Employment Act 1932.

Eligibility for Severance Pay

Severance pay is specifically applicable in cases where the employee's dismissal stems from redundancy, a situation where the job itself is no longer required. Employees must have at least one year of continuous service with the same employer to qualify for severance pay.

Calculation of Severance Pay

The severance pay calculation takes into account the employee's length of service and their average weekly earnings. The formula per the Employment Act 1932 is as follows:

• For each of the first 5 completed years of service: 2 weeks of pay
• For each of the next 5 completed years of service: 3 weeks of pay
• Each completed year thereafter: 4 weeks of pay

The total amount of severance pay cannot exceed the equivalent of one year's pay. "Average weekly earnings" are calculated based on the employee's regular pay and exclude overtime or irregular payments.

Example

An employee in Gibraltar with 7 years of service, made redundant, with average weekly earnings of £500 would be entitled to:

• (2 weeks' pay * £500) * 5 years = £5000
• (3 weeks' pay * £500) * 2 years = £3000
• Total Redundancy Pay: £8000

Specific Exemptions

Employees on fixed-term contracts that are not renewed due to the natural end of the contract period may not be eligible for severance pay. However, if the dismissal takes place before the expiry of the fixed term, the employee may be entitled to 50% of the severance pay that would have been due had the contract expired.

Important Considerations

Severance pay is distinct from other payments that may be due upon termination, such as accrued salary, unused vacation, etc. For precise calculations and specific circumstances, it's advisable to consult the Government of Gibraltar's Department of Employment or a legal professional well-versed in Gibraltar employment law.

In Gibraltar, the termination of employment is regulated by the Employment Act 1932. The key processes are based on the different types of termination: dismissal for cause, redundancy, resignation, and constructive dismissal.

Dismissal for Cause

Dismissal for cause occurs when the employer terminates the employment contract due to the employee's misconduct or performance issues. Valid reasons for dismissal must be related to the employee's conduct, capacity, or qualifications for the job, or based on operational requirements within the business. Examples include serious misconduct, gross negligence, repeated instances of poor performance, and inability to fulfill job duties.

Although Gibraltar does not have a statutory unfair dismissal law, employers must follow fair procedures before dismissing an employee. This includes investigating any allegations, providing the employee with a fair opportunity to respond to allegations, considering any mitigating factors, and following disciplinary procedures outlined in the contract or company handbook.

Redundancy

Redundancy is when the employer ends the employment contract because the employee's job function is no longer required. The employer must establish that the employee's position is genuinely redundant due to changes in the business's operational needs.

Employers have an obligation to consult with affected employees and follow fair selection criteria if multiple employees are facing redundancy.

Resignation and Constructive Dismissal

Resignation is when the employee voluntarily chooses to terminate their own employment. Constructive dismissal, on the other hand, is when the employee resigns due to the employer's serious breach of the employment contract, making it untenable for the employee to continue working.

Additional Considerations

It's recommended practice (though not legally mandatory) to provide the employee with written notice of termination stating the reason for dismissal and the effective date. Employees may have a right to appeal a dismissal depending on their employment contract's terms or company policies.

Employment law in Gibraltar can be complex. It's always advisable to seek professional legal advice for specific situations and to ensure compliance with all applicable regulations.