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What to do when an employee withdraws their resignation?

01 August 2018

Employers are generally of the view that once a resignation is given and accepted, they are under no obligation to allow an employee to withdraw it. However, the employer’s obligation of good faith under the Employment Relations Act 2000 requires an employer to investigate the employee’s true intentions if it is unclear if the employee really intended to resign or not.

The Employment Court in Boobyer v Good Health Wanganui Ltd helpfully categorised four general scenarios in which resignations can occur. These are:

  1. Where the employee unambiguously resigns;
  2. Where there is an ambiguous communication that is misunderstood by the employer as a resignation;
  3. Where the employer seizes on unintended words not reasonably capable of amounting to a resignation; and
  4. Where a resignation comes in the context of an emotional reaction or outburst.

 

Unambiguous Resignation

Where an employee clearly resigns and later seeks to take it back.  In this case the resignation cannot be withdrawn without the employer’s consent. It may be good practice for an employer to ask why the employee is resigning, but in most circumstances once the notice of termination has been given by an employee, the contract will come to an end unless both parties agree to revive it.

In these circumstances, if an employee resigns unequivocally it will be a clear cut resignation and the employer is under no obligation to agree to the resignation being withdrawn.

Ambiguous Resignation

This is where an employer misinterprets an ambiguous communication as a resignation. This could include discussions regarding resignation and the employer thinking that the employee intended to resign. Here, an employee must take action and actively let their employer know that resignation was not their intention. If an employee is not active in communicating this, it is easy for misunderstandings to arise.

Employer Seizing on Unintended Words

This is where an employer seizes on an employee’s statement which was not reasonably capable of amounting to a resignation. For example, where an employee does not actually say the words “I resign” but says something like “I’m considering resigning”. This is where the employer’s obligation of good faith obligation requires the employer to enquire into what the employee really meant rather than jumping to conclusions.

In this situation, where there is some doubt as to what the employee actually intended, an employer cannot simply rely on their own interpretation of what the employee said (or did) as a valid resignation. They need to take steps to clarify and be sure resignation was intended.

Emotional Resignation

This is the most common category. Where a resignation comes in the context of an emotional reaction or outburst, an employer should give the employee a reasonable opportunity to reconsider their decision and potentially withdraw the resignation.

In McDonald v Speciality Fashion Group an employee told her Regional Manager to “stick her job” and that she “wasn’t putting up with this anymore and wasn’t paid enough for this crap”. The Regional Manager appreciated these comments were made in the heat of the moment and allowed her a cooling off period. However, the Regional Manager made her own inquiries about the employee’s performance and chose not to accept Ms McDonald’s retraction when it was offered.

It was held the actions of the Regional Manager were not those of a fair and reasonable employer and instead constituted a dismissal. Further, if the employer had other concerns regarding the employee, for example relating to their performance or conduct, these should have been addressed separately to any request to withdraw a resignation.

What to do in this situation

When faced with a potential resignation, best practice for employers is to allow a “cooling off” period. The good faith obligation to be active and constructive then requires an employer to take steps to clarify an employee’s true intentions before accepting the resignation.

If you as an employer find yourself in a situation where it is unclear whether an employee actually meant to resign, please contact a member of our employment team for advice.

 

Emma Thomson is a Solicitor in the Court & Disputes/Employment Team at Norris Ward McKinnon. You can contact Emma at emma.thomson@nwm.co.nz