RESIGNATION OF EMPLOYMENT
Resignation refers to an employee’s voluntary decision to leave a position or job. The critical element is that the exercise has to be voluntary to be a genuine resignation.
Employers should note:
- Resignations should be in writing and should specify a specific date for the resignation to take effect;
- Employees who fail to give required period of notice may liable to pay a penalty to the employer to cover the period (depending on the relevant award or contract of employment);
- Payment in lieu of notice can be made by an employer who prefers the resigning employee to not work out the required notice period; and
- A forced resignation is really a dismissal at law (constructive dismissal).
An employee’s notice of resignation should always be kept on file. In the absence of a formal written notice of resignation (e.g. in the case of a verbal resignation), the employer can prepare a confirmation of resignation letter to the employee.
When an employee resigns, they may have to give notice to their employer. An employee’s award, agreement or contract of employment may set out how much notice they have to provide to their employer.
When an employee has resigned and given their minimum notice, their employer can:
- Let the employee work out the notice period, or
- Tell the employee to leave early and pay them in lieu of notice instead.
If the employer decides to tell the employee to leave early and pay them in lieu of notice, they need to pay the notice period (including incentive-based payments and bonuses, loadings, allowances and penalty rates that they would have been paid).
An employer can also decide to have the employee work out part of the notice period and provide payment in lieu of notice for the rest of it.
A forced resignation, often referred to as a constructive dismissal, is when an employee has no real choice but to resign as a result of the actions or inactions of their employer.
The onus is on the employee to prove that they did not resign voluntarily. The employee must provide that the employer forced their resignation.
The Fair Work Act reflects the common law concept of constructive dismissal, and allow for a finding that an employee was dismissed in the following situations:
- Where the employee is effectively instructed to resign by the employer in the face of a threatened or impending dismissal; or
- Where the employee quits their job in response to conduct by the employer which gives them no reasonable choice but to resign.
In such situations, employees may have an argument to pursue an unfair dismissal application against the employer.
About Employment Innovations
Employment Innovations is one of Australia’s leading providers of employment services designed to increase productivity and ensure compliance. Its services and solutions include all the tools that every Australian small to medium sized employer needs – including workplace advice, legal services, payroll solutions, migration, human resource management and HR software.
The information provided in these knowledge base articles is general in nature and is not intended to substitute for professional advice. If you are unsure about how this information applies to your specific situation we recommend you contact Employment Innovations for advice.
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