Employers often wish to get rid of particular employees for a variety of reasons – misconduct on the part of the employee, a clash of personalities, or allegations of under-performance, for example. In dealing with these issues and attempting to maneuever the employee out of their employment, employer’s often suggest to the employee that it would be better for them to resign from their employment rather than be dismissed (with the potential consequent impact on references or financial payments). This is common in situations where senior executives leave employment – they’re pretty much given the option to jump or get pushed by their employer. However, employers should be careful in these situations as it may be the case that these circumstances could amount to a dismissal, and therefore a potential finding of unfair dismissal. We’re going to take a look at “forced resignations” in this post and examine how employers should approach this. We’ll do so by examining the following:
- In what circumstances might a termination of a contract of employment be a dismissal, a resignation or a mutual termination?
- In what circumstances might the resignation be deemed to be forced?
- What happens if a “forced resignation” takes place?
In what circumstances might a termination of a contract of employment be a dismissal, a resignation or a mutual termination?
The three most common ways for a contract of employment to be terminated are if a dismissal by the employer takes place, the employee resigns from their employment, or there’s a mutual agreement that the employee’s employment relationship with the employer will come to an end. Which one of these takes place is a question of fact in the circumstances – the situation normally isn’t ambiguous can it can be in certain situations, such as (as we’re examining here) when the employee is given an opportunity to jump or get pushed.
In what circumstances might the resignation be deemed to be forced?
If the resignation of an employee is procured by fraud, pressure or ultimatum by the employer then the question of whether in actual fact the employee resigned or was dismissed is one that depends upon the particular facts of the matter. The question is: “who really terminated the contract of employment?”. If the employer has informed the employee that they’ll be dismissed at a particular date – regardless of the outcome of an investigation and disciplinary procedure – then this would probably be deemed to be a dismissal as the employer is effectively terminating the contract of employment. Equally, if the employee is told that they can either reduce their working hours, accept a new role, or take redundancy then this may be treated as a dismissal and not a consensual termination (or termination by mutual agreement). In these circumstances it’s best to try and reach a settlement agreement with the employee to prevent them from being able to make a claim for unfair dismissal at a later date.
What happens if a “forced resignation” takes place?
If a “forced resignation” takes place then an employee can make a claim to the Employment Tribunal for unfair dismissal (unless they’ve signed a valid compromise agreement with their employer already which precludes them from doing so). Employers should be wary, therefore, of engineering a situation where they’re potentially unfairly dismissing employees by pressuring them or providing them with ultimatums.
Employment Law Advice Solicitors are employment law solicitors based in London.
Employment Law Advice Solicitors
