PILON (Pay in lieu of notice clause)

PILON (Pay in lieu of notice clause) is a contractual right to pay an employee a lump sum rather than require them to work out their statutory or contractual notice period.
If there is no PILON clause in a contract of employment then an employer who pays an employee a lump sum salary payment instead of requiring them to work their period of notice will technically be in breach of contract but the employee will usually have suffered no loss.

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