When you resign from your employment, you give up all your rights to severance pay. This makes it attractive for employers to characterize a termination as a resignation. We often see employers insisting that an employee has quit, when really the employee has been dismissed. So how can you tell the difference between “I quit” and “you’re fired”?
Our lawyer Brendan Harvey recently took this question to court and won 15 months of reasonable notice for our client, whom the employer insisted had resigned. Clearly employers and employees are confused by the law in this area. We set out the legal guidelines below.
Resignation must be “clear and unequivocal”
The legal test is very basic: would a reasonable person in the circumstances understand that you resigned?
In order to effectively resign, you need to say, write, or do things that clearly give the employer to understand that you are resigning. Giving advance notice of resignation in writing, and not retracting that resignation, is usually a pretty strong indication of an intention to resign. Leaving work and not coming back is also a good indication of intention to resign.
Resignation in the heat of the moment
Sometimes the relationship with the employer deteriorates, and in a moment of frustration, the employer resigns. Surprisingly, that’s not the end of the story. In a case involving a winery in the Interior of British Columbia, a winemaker and the owner of the winery had an argument in which the winemaker became highly emotional, even launching untrue accusations at the owner. The owner told him that if he was so unhappy in his position, maybe he should seek work elsewhere. The winemaker put his keys on the table, left “wearing a big smile on his face”, and never returned. The employer did not make any inquiries after the employee. The BC Supreme Court found that the employee’s resignation, given in the heat of the moment, should have been further investigated by the employer. In this case, the employer accepted the heated resignation – and the employee was wrongfully dismissed. Although he had worked for the employer for only two years, he was entitled to eight months of pay in lieu of reasonable notice.
Can the employer make you retire?
Wrongful resignation cases often crop up when an employee nears retirement age, especially when the employee has been vocal about a wish to retire at a certain age. In one case, the employee had done exactly this, but then changed his mind when he did approach his 65th birthday. He never acted on his intention to resign at 65. The employer, on the other hand, put him out the door on his 65th birthday, relying on his previously stated intentions. The court found that the employee had not given the “clear and unequivocal” notice required, and the employee was wrongfully dismissed.
Some employers have a policy of mandatory retirement at a certain age. British Columbia courts have held that these policies can be legally valid (setting aside whether they're discriminatory), but only if the policies are clearly written and the employee accepts them as a term of the employment. Where there is ambiguity in the policy, and the employer relies on the policy to dismiss an employee on their birthday and call it a resignation, that employee has probably been dismissed - and an employee of retirement age is probably entitled to more severance pay because of their age.
Can you take back a resignation?
What if you resign, and then take back the resignation? You’re entitled to do this and remain employed – unless the employer has taken steps “to its detriment” because of your resignation. As an example, if you give two months’ advance notice of resignation, and the employer pays a recruiter to find someone to replace you and then does hire a replacement, the employer has acted to its detriment because of your resignation. You would probably not be able to retract the resignation in that situation. However, if the employer has taken no steps to replace you (or other steps in reliance on your resignation), then at law, “take-backs” are allowed.
Resignation and constructive dismissal
Where the employer has changed important terms of your employment without your permission, and as a result you resign, this can form the basis of a constructive dismissal and a claim for reasonable notice. A constructive dismissal usually involves the employee resigning from the employment - but you should make sure it's done in the right way in order to preserve your rights.
Read more about constructive dismissal.
If you're not sure whether you've resigned of your own initiative, there's a good chance you've actually been dismissed. Talk with a one of our employment lawyers today to learn your rights.
