ComplianceLegalFebruary 02, 2021

Handling employee resignations

While you can't dictate the exact terms and circumstances of employee resignations, you can put procedures into place that make the process easier. For example, establishing an advance notice policy for quitting employees can give you time to hire a new employee before you're left short-staffed.

You might be the greatest employer in the world but eventually you will have an employee who wants to end your employment relationship. You can't prevent workers from quitting but what you can do is request advance notice when employees resign.

Of course, you can't force a departing employee to follow your procedures any more than you can make him or her stay. However, you can suggest that if the employee follows your procedures, that will allow you to give a good job reference and tell any prospective employers that the worker was responsible and cooperative.

Requesting advance notice

Whether you want or need advance notice of resignations depends on the nature of your business. If you are in an industry where people commonly come and go, and where it's relatively easy to find good replacements, you may not care about advance notice. If you want exiting employees to train their own replacements, a two-week notice period may be a reasonable request.

And in some cases, you may decide that you don't want a "lame duck" employee around. If you have established a notice policy, fairness requires that you pay the person for the remainder of the notice period, if you decide that you don't want him or her to work out the entire period.

If you decide that you want advance notice of resignations, how do you establish a notice policy? It's relatively simple--just place the advance notice request in the list of work rules that you give to incoming employees.


The following could be placed in your list of work rules:

We hope that you will never find it necessary to resign. However, if you do, we ask that you give at least two weeks' notice. Proper notice allows us to prepare your final paycheck and separation papers, and preserves your record as a responsible and cooperative employee. In some cases, we may choose to pay your two weeks' salary rather than require you to work the two weeks. If you don't give the required notice, you may become ineligible to be rehired in the future.

Don't threaten to withhold benefits or pay. Can you threaten to withhold benefits or pay if a resignation procedure is not followed? Probably not — most states have laws requiring that employees be paid whatever they have earned, and paid on time. Penalties have been imposed even where there were only minor delays in paying the last check.

Handling prompted resignations

When is a resignation not a resignation? A resignation is truly voluntary, while a "prompted resignation" is a resignation that appears to be voluntary on the surface. However, the idea or motivation for the employee to resign came from somebody else, usually the person's boss.

In some cases, the employee expresses the wish to resign rather than to be fired. In others, you may offer the opportunity to resign, so you don't have to fire the person, so you don't have to document the situation extensively, and/or so you can avoid additional time and costs.

Why it matters. In general, it's better for you if the employee resigns. An employee who wants a job reference that says he or she resigned, rather than a reference that shows he or she was fired, is less likely to sue you. He or she is also less likely to file for unemployment benefits, since these benefits aren't paid for voluntary resignations. However, it's always possible that the worker could change his or her mind and story sometime in the future, so be sure you treat the prompted resignation as if it were a firing for your own internal records.

On the other hand, an employee resignation can cause problems. In some cases, workers resign because they believe they are being forced out, harassed, or treated unfairly for unlawful reasons. It's important to uncover these situations in advance, so that you can begin to prepare a defense if a lawsuit is ultimately filed.

In addition, it's advisable that you request an exit interview and/or have the worker fill out an exit questionnaire whenever someone leaves your employ.

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