What Do You Need to Know about Employee Resignations?

What is an Employee Resignation?

A valid employee resignation refers to the decision of an individual to voluntarily leave their position. For a resignation to be legitimate, it must meet certain legal and procedural standards. These standards help ensure that the resignation is intentional, clear, and properly conveyed.

Generally speaking, employees resignations are straightforward: the employee submits a formal resignation letter with a signature and an effective date. But what happens when an employee simply exclaims, “I quit!” before leaving the office in frustration, hints at dissatisfaction with their job, or mentions receiving another job offer?

Sometimes, we call this a “heat of the moment resignation” refers to an employee impulsively decides to resign from their job during a stressful or heated situation, often without proper consideration or prior notice to the employe. Quite often, this is due to an argument or strong emotional reaction in a confrontation with a manager or supervisor at the time. Essentially, they resign in the midst of a heated moment, rather than making a well-thought-out decision.

What Happens if an Employee Resigns?

As a matter of industry custom (or sometimes due to a legal obligation in an employment contract), an employee is required to provide reasonable notice to an employer before resigning from their job. The failure to do so may be considered a wrongful resignation, entitling an employer to an award of damages (GasTOPS Ltd. v. Forsyth, 2012 ONCA 134 (CanLII). The purpose of

reasonable notice is meant to give the employer time to look for, hire and train a replacement.

Contrary to common misconception, there is no statutory requirement for an employee to provide an employer with reasonable notice of resignation under the Ontario Employment Standards Act, 2000. When required under common law, the factors that are taken into consideration in determining an appropriate notice period are the employee’s:

the job title and responsibilities
nature of the employee’s position and the nature of the employer’s industry
length of service
compensation (level of salary, bonus, commissions, health benefits, pension plans, and so on)
the time it would reasonably take the employer to replace the employee or otherwise take steps to adapt to its loss, including how long it will take the employer to recruit, train, and familiarize the new employee(s) to the employer’s products and clients

Clear and Unambiguous Intent for a Valid Employee Resignation

Under common law, the courts have held that in order for a resignation to be legally valid, the employee must show a clear and unambiguous intention to quit and properly communicate this to the employer. In other words, to be effective, a resignation must be “clear and unequivocal”.

This means the resignation must be communicated directly, without any room for misinterpretation. Casual or vague comments about leaving the job, especially when said in frustration, do not qualify as a formal resignation. For example, an employee who says they might quit in the heat of the moment doesn’t meet the criteria for a valid resignation.

To determine if an employee’s resignation is legally valid and effective, the courts apply the following test:

“whether the employee intended to resign and whether the employee’s words and acts, objectively viewed, support a finding that she resigned.”

In responding to an employee resignation, employers must look at the entire context objectively to determine whether the employee’s words or action demonstrate a clear and unambiguous resignation. The surrounding circumstances are relevant to determine whether a reasonable person, viewing the matter objectively, would have understood [the employee] to have unequivocally resigned (Kieran v. Ingram Micro Inc. 2004 CanLII 4852 (ON CA)).

Moreover, an employee resignation must be voluntary and not obtained by coercion or duress. Thus, an ultimatum or demand by the employer for a resignation, or a choice between resigning or being fired, will be considered equivalent to a dismissal. Similarly, an otherwise valid resignation made while the employee is under significant stress, whether caused by a health issue or due to the employee’s particular sensitivity, may undermine the voluntariness of the resignation and make it invalid.

On the other hand, an employee who initiates her own dismissal by giving an employer an ultimatum to the effect of “it’s either her or me” or “increase my salary or I quit,” may be treated as having properly resigned, as the courts have found that these words constitute a clear and unambiguous statement of an intention to resign. At this point, if these words are accepted by an employer, they become legally binding on the employee, ending their employment as a valid resignation.

Likewise, an employee who quits his job believing that he or she has been constructively dismissed may be treated as having resigned if in fact the court later determines no constructive dismissal has occurred.

What Happens if an Employee Resigns? Can You Take it Back?

An employee may be able to retract (resile from) a resignation, as long as the employer has not accepted it, or otherwise has not relied on the employee’s resignation to its detriment (e.g., hired a replacement).

However, even where an employer has “accepted” a clear and unequivocal resignation, some courts have held that, since an employer has an ongoing duty of good faith and fair dealing towards an employee, it must provide sort of “cooling off period” to allow an employee time to reconsider his or her resignation, and to make further inquiries and act with consideration in response to the resignation. This is especially important in “heat-of-the-moment” resignations, such as following an argument in the workplace.

If an employee voluntarily resigns, the legal consequence is that they cannot sue their employer for wrongful dismissal claim or justify efforts to negotiate a severance package.

Book a Consultation with an Employment Lawyer in Toronto

If you recent resigned from your job and would like to pursue a severance package negotiation or constructive dismissal claim, please call us to discuss your options. As an employment law firm in Toronto, Bune Law has reviewed many severance packages and are skilled at negotiating improvements. You will review and get guidance on your severance package before you agree to sign any termination documents, and help ensure that your severance package is fair and reasonable.

Book a confidential consultation with our Toronto employment law firm to protect your legal rights to understand your options and protect your rights.

Why Choose Bune Law When You Need an Ontario Employment Lawyer?

Experience in all areas of workplace law, including wrongful dismissal claims, constructive dismissal claims, severance package reviews, severance package negotiations, discrimination and human rights disputes, and employment contract reviews, including navigating the important issue between just cause vs. wilful misconduct in Ontario employment law.
Proven track record of successfully resolving workplace disputes through negotiation, mediation, and employment litigation.
Compassionate and personalized approach to each case, ensuring tailored solutions that meet your specific needs.

Please call today to speak with an employment lawyer in Toronto about your case! Call 647-822-5492, or fill out our contact form to the side.