An employee resigning seems like a simple enough concept, but there are some common misconceptions that we’re addressing in this spotlight to help employers avoid getting caught out.
Resignation is a one-way act and is at the sole decision of the employee. The employer doesn’t need to accept the resignation to make it valid, and the employer can’t reject a resignation.
Employers can’t force an employee to stay employed, even if you think they are making the wrong decision or acting in breach of their contract.
You should however consider whether a resignation has been made in the heat of the moment. For example, has an employee been faced with a stressful situation and, as a knee jerk reaction, said they’ve had enough and they’re leaving?
If so, and the employee has at least 2 years’ service, you should let the dust settle then ask the employee, usually the next day, to consider whether they still feel the same way.
If they do, fine, but if they have reflected and changed their mind, it could be worth leaving it at that otherwise, depending on the circumstances, the employer could end up facing an unfair dismissal claim.
Acting in breach of contract
If you think the employee is acting in breach of contract, for example, they are intending to work for a competitor in breach of post termination restrictions, or failing to serve their contractual notice, then you would need to take formal legal action.
It might be possible to obtain damages, and/or prevent them from working for a competitor, but the Courts won’t force an individual to remain employed by a particular employer if they don’t want to be.
What to do when an employee resigns
You should acknowledge the resignation, and confirm in writing the arrangements that will apply, for example, what the termination date is, how accrued holiday will be treated, any handover required and obligations that will continue to apply post termination.
If an employee resigns but you want to encourage them to stay then of course there is nothing stopping you from trying. It won’t however stop the clock on the notice period running, so don’t put all your eggs in one basket!
Can an employee retract their resignation?
Generally no, if an employee changes their mind and wants to retract their resignation, it is up to the employer whether or not to allow them to. There is no obligation on an employer to permit a retraction, but you should always consider whether the resignation was in the heat of the moment. If so, it might be in your interests to permit the retraction.
When can a resignation be deemed?
Never. There are no circumstances in which an employer can, or should, “assume” that an employee has resigned.
Sometimes it may seem as though the actions of an employee are such that you should be able to treat the relationship as having come to an end – sort of like a constructive dismissal in reverse. However, there is no such thing as a constructive resignation.
Resignation needs to be clear and unequivocal – so an employee making a comment that, for example, they’ve “had enough” or perhaps just going AWOL, isn’t enough to constitute a resignation.
What if the employee alleges that their resignation is constructive dismissal?
An employee with at least 2 years’ service has the right not to be unfairly dismissed, which includes constructive dismissal.
Constructive dismissal occurs when the employer commits a fundamental breach of the employment contract, such that the employee can treat the contract as having been brought to an end. In other words, the employee’s continued employment has been made untenable as a result of the employer’s actions.
In such circumstances, the employee can choose whether to leave immediately, or to give notice (although giving notice may later undermine any claim of constructive dismissal they seek to bring).
If an employee does make these allegations in their resignation, the employer should seek advice about how to best protect their position. However, the general mechanics of how to deal with the resignation remain the same.