This is part of a “hands on guide” to assist you in the legal discipline and discharge of employees as presented by Fort Wayne Business Attorney Loren Allison, covering the following topics & more! Download your copy by clicking here (PDF)
TERMINATION OR RESIGNATION?
In order to make a legal difference, it is imperative that an employee voluntarily resigned. An employee who is told that unless he/ she resigns he/ she will be discharged, has not voluntarily resigned. If the resignation is involuntary, the former employee has precisely the same legal recourse he/ she would have had if he/ she had been formally discharged by the employer.
There are, nonetheless, some significant advantages where an employee resigns, albeit involuntarily. The primary advantage rests with the fact that the employee may not know that it makes no difference; that he/ she was forced to resign, as opposed to being discharged. Many employees believe, as many employers do, that by resigning they forego any legal recourse against their former employer. In short, though no legal protection is afforded by a resignation as opposed to a discharge, the practical effects may be the same.
Also, by permitting an employee to resign, the employee is left with his/ her self-respect, which in many cases will do much to appease the employee and make them far less likely to take retaliatory legal action. Finally, by permitting an employee to resign, prospective employers can be told the employee resigned, thus enhancing the ex–employee’s chances for securing new employment. It is recommended that the employee be expressly told at the time of resignation that should prospective employers contact the former employer, the prospective employer will be told that the employee voluntarily resigned.
It may also be advisable to discuss the question of unemployment compensation benefits at the time resignation/discharge is being discussed. An employee may be induced to resign if the employer makes it clear that unemployment benefits will not be contested. By not contesting unemployment benefits, the employee may be induced to forego any additional legal proceedings.
2. Constructive Discharge
The resigning employee may still bring legal action against the former employer by arguing that he/ she was “constructively discharged.” Constructive discharge occurs when the employer deliberately makes an employee’s working conditions so intolerable that the employee is forced to resign. Under such circumstances, the employer will be held liable for any illegal conduct as if the aggrieved employee had been formally discharged.
The constructive discharge doctrine has been recognized by both the Equal Employment Opportunity Commission and the National Labor Relations Board. The EEOC has established three elements that an employee must prove to substantiate a claim for constructive discharge; 1) a reasonable person in the employee’s position would have found the working conditions intolerable; (2) conduct constituting actionable employment discrimination against the employee created the intolerable working conditions; and (3) the employee’s “involuntary” resignation resulted from the intolerable working conditions.
The NLRB’s emphasis arises in the context of a potential violation of Section 8(a)(1) of the NLRA, that prohibits employers from retaliating against employees for engaging in protected labor organizing activities. In general, the NLRB, upon a finding of constructive discharge, generally concludes that the employer engaged in calculated efforts to force an employee to leave and that the employee had no free choice in the matter.
In addition to the EEOC and NLRB, the constructive discharge doctrine is well-accepted in all state and federal courts. The basic standard applied is that an employer deliberately makes an employee’s working conditions so intolerable that the employee is forced into an involuntary resignation.
An employer’s defense against such claims is to apply an “objective” standard, whether the working conditions under which the employee was required to work were objectively intolerable as measured from a reasonable employee’s standard. Therefore, when faced with a claim of constructive discharge, an employer’s initial challenge to the claim should be that the type of conduct being complained of does not constitute the type that a reasonable employee would have found so intolerable as to compel that employee’s involuntary resignation.
Article by Loren K. Allison, attorney at law
Call For A Consultation: (260) 466-5205