Is it ever okay to ask an employee to resign?

by Chloe Taylor25 Nov 2015
Most HR managers would know that asking an employee to resign is a dangerous area – but are there ever any cirucmstances in which doing so would be legally acceptable?

According to Erin Lynch, senior associate at People + Culture strategies, there are limited circumstances in which employees can be asked to resign, one being where the alternative is the legitimate termination of their employment.

“There are protections in the Fair Work Act that cover situations where the employee has not resigned voluntarily – for example in the unfair dismissal jurisdiction, involuntary resignation can fall under one of the definitions of unfair dismissal,” she told HC.

Lynch explained that if an employer is considering offering a worker the chance to resign, they need to have a clear conversation with the employee.

“If the employer is considering having that discussion, they need to consider what the protections are,” she advised.

“It depends on context in which the discussion takes place.

“The most common circumstances in which we see these discussions being held are where it’s an alternative to termination which is inevitable following performance management or misconduct.

“If an employer asks someone out of the blue to resign, they are opening themselves up to discrimination claims, general protection claims, and all sorts of legislative breaches.”

Lynch suggested that the best way to proceed would be to have that discussion as soon as the decision has been made to terminate the employment.

“It could come up as part of a conversation about the individual’s ongoing employment prospects; tell them that you are willing to accept their resignation rather than terminating them,” she said.

“Protecting yourself is all about that conversation and how you document it – ensure that you record the fact that you are really putting the option to the employee.

“If they are given that option, make sure that you tell them you have made a conclusive decision and why you have made it – you have to be very clear, and they have to be legitimate reasons.”

Lynch added that if you go through that process, from a performance management perspective it would be unlikely that anyone could argue there had been a forced resignation.

“It’s all around messaging and making sure that it’s clear the resignation has not been forced.”

Why choose resignation?

Lynch outlined the benefits of resignation over termination from both perspectives.

“From an employee perspective, a resignation is preferable for the sake of their future job prospects,” she told HC.

“For the employer, communicating to others in the organisation is probably better and easier if you are explaining that an employee resigned rather than explaining the termination issues.”

Opting for voluntary resignation can also offer the employer a legal safety net if carried out in the right way.

“Usually if you offer the option, you may document that in a deed of release, so there’s protection from any claims that the employee might have made against you,” Lynch told HC.

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