Resignation Notice in Australia: An Employer’s Guide

When a team member resigns, the “notice for resignation” period is where the handover happens, workloads are reshaped and employment obligations kick in.

Handled well, it’s smooth and professional. Handled poorly, it can disrupt customers, morale and compliance.

This guide breaks down how notice works in Australia from an employer’s perspective, what to check in awards and contracts, and the day-to-day steps to manage a resignation confidently and lawfully.

What Is A Notice For Resignation And Why It Matters?

A notice for resignation is the time between when an employee tells you they’re leaving and their final day of employment.

During this period, you’ll plan the handover, secure knowledge transfer and meet your legal obligations around pay, leave and records.

Why it matters:

• Continuity of operations - handover and training can be scheduled properly.
• Compliance - you must follow the contract, applicable award or enterprise agreement, and Fair Work laws.
• Cost control - decisions around working the notice vs payment in lieu affect payroll and resourcing.
• Risk management - garden leave or access controls may be appropriate where sensitive IP or clients are involved.

How Much Notice Should Employees Give In Australia?

The required notice is usually set by the employee’s contract and any applicable industry award or enterprise agreement. If a contract is silent, minimums under the National Employment Standards (NES) may apply (and awards often add extra rules).

As a starting point, review:

• The signed Employment Contract.
• The relevant modern award or enterprise agreement (if any).
• Any policies you’ve issued that refer to resignation or notice.

For a deeper dive into expected timeframes and how NES interacts with awards, see resignation notice periods.

Keep in mind:

• Seniority can impact notice (e.g. executives may have longer notice periods in their contracts).
• Casual employees generally don’t have to give notice (unless an award or contract says otherwise).
• Some awards allow you to deduct a limited amount if an employee doesn’t provide the required notice (but there are strict conditions-check the precise terms before acting).

A Practical Workflow For Managing Resignations

Here’s a simple step-by-step approach you can adapt for your business when someone resigns.

1) Confirm The Resignation In Writing

Ask for a written resignation with the proposed final date and confirm back (also in writing) the notice period, last day and how leave/handovers will be handled.

2) Check The Contract And Award

Verify the notice period, whether you can direct work during notice, any rights to place the employee on garden leave, and how unused annual leave and other entitlements are treated.

3) Plan The Handover

• Identify critical projects, clients and knowledge areas.
• Assign an internal owner for the handover plan.
• Schedule time with the employee to document processes and train colleagues.

4) Decide Whether They’ll Work, Be Paid In Lieu Or Go On Garden Leave

This is a commercial and legal call-balance operational needs, confidentiality and team dynamics. We cover these options in more detail below.

5) Calculate Final Pay Correctly

Final pay must include all outstanding wages, allowances, loadings, and accrued (but untaken) annual leave, plus any other entitlements from the contract or award. Use a clear checklist and pay by the due date in the relevant industrial instrument. Our guide on calculating final pay explains the components employers commonly miss.

6) Secure Access, IP And Clients

• Adjust system and premises access appropriately during notice.
• Remind the employee of confidentiality and post-employment obligations.
• Communicate client transitions early and professionally to protect relationships.

7) Close Out Documentation

Issue a written acknowledgement of the resignation, update payroll and HRIS records, and retain copies in your files. If you don’t yet have a robust template Employment Contract, it’s a good time to refresh your documents for future hires - our Employment Contract service can ensure the right clauses on notice, confidentiality, IP, garden leave and deductions are in place.

Can You Shorten, Waive Or Pay Out Notice?

In many cases, yes-but only if your contract, award or enterprise agreement allows it and you follow the correct process.

Working The Notice

Default position: the employee keeps working during notice. You can set reasonable duties and hours in line with the contract and applicable award, and you should focus on a clean handover.

Payment In Lieu Of Notice

You can generally choose to end employment sooner and pay the employee what they would have earned if they had worked the notice period, provided your contract and applicable industrial instrument permit it. This is called payment in lieu. Read our employer guide to payment in lieu of notice for calculation tips and compliance checkpoints.

Mutual Agreement To Reduce Notice

You and the employee can agree to a shorter notice period. Put the agreement in writing, specify the revised last day and confirm how final pay will be handled.

Directing Garden Leave

Where the contract allows, you may direct an employee not to attend work (or to perform limited duties) while remaining employed and on pay. This can be appropriate for client-sensitive roles or where you need to protect IP. Our overview of garden leave explains the practicalities for Australian employers.

Handling Tricky Situations During Notice

Real-world resignations don’t always go to plan. Here are common scenarios and how to respond.

What If The Employee Won’t Work Their Notice?

First, check the contract and any award. Some awards allow limited deductions from final pay if an employee doesn’t provide the required notice, but conditions are strict. In many cases, it’s better to negotiate a shorter notice period and focus on the handover that’s practical to achieve.

For options and boundaries, see our guide on an employee not working the notice period.

Can They Take Annual Leave During Notice?

Employees can request annual leave during notice, but you can usually decline requests that unreasonably affect business operations (subject to any award or agreement rules). If leave is approved, the last day of employment usually doesn’t change-leave simply counts as paid time during notice. Unused annual leave must be paid out at the end of employment, which is covered in our article on annual leave on resignation.

Sick Leave And Evidence

Personal/carer’s leave can be taken during notice in the usual way, and you can request evidence (e.g. a medical certificate) if required under your policy, contract or award. Be consistent with your approach.

Performance, Misconduct Or Access Risks

If issues emerge during notice (e.g. refusal to follow reasonable directions or confidentiality concerns), consider garden leave or payment in lieu (if permitted) to remove access while maintaining compliance. For serious allegations, follow your normal investigation process-resignation doesn’t prohibit taking reasonable steps to protect your business.

Final Pay Timing And Components

Pay final amounts by the date required under the applicable award or agreement. Include base pay, overtime or allowances due, and accrued but unused annual leave (and, where applicable, leave loading and any contractual bonuses that have become payable). If you’re unsure how to structure this payout, the checklist in calculating final pay will help you get the numbers right.

Communicating With Your Team And Clients

Announce the change early and positively. Confirm who will take over key responsibilities, and give clients a clear single point of contact. Professional communication reduces friction and protects your brand.

Record-Keeping And Exit Processes

Collect company property, remove system access on the agreed date, and retain employment records as required by law. Where appropriate, include a reminder of ongoing confidentiality and any post-termination restraints contained in the Employment Contract.

What Should Your Contracts And Policies Say?

The best time to make resignations simpler is before they happen-by having clear, tailored contracts and policies. At a minimum, ensure your contracts cover:

• Notice provisions - length of notice and how it can be given.
• Payment in lieu - the right to pay out notice and end employment earlier where lawful.
• Garden leave - the ability to keep the employee away from the workplace during notice while maintaining pay.
• Confidentiality and IP - strong obligations that continue after employment ends.
• Deductions - where permitted by an award or agreement, clear wording for any allowable deductions (never deduct without a lawful basis).
• Post-employment restraints - reasonable non-solicit or non-compete clauses where appropriate.

If you’re establishing or updating your template, our lawyers can draft a comprehensive Employment Contract aligned with your industry and workforce structure.

Key Takeaways

• Start with the contract and any applicable award or enterprise agreement to confirm the required notice for resignation and how it should be managed.
• Choose the right approach-working notice, garden leave or payment in lieu-based on operational needs and legal permissions.
• Use a clear workflow: confirm in writing, plan the handover, secure access and clients, and pay final amounts correctly and on time.
• Prepare for tricky scenarios-if the employee won’t work their notice, check the rules and consider practical alternatives using this notice period guide for employers.
• Strengthen your documents: a well-drafted Employment Contract with clear notice, confidentiality, garden leave and restraint clauses makes resignations smoother.
• Final pay must be accurate-use this checklist for calculating final pay and include any required payout of annual leave at resignation, covered here: annual leave on resignation.

If you’d like a consultation on managing a notice for resignation or updating your contracts, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.