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Is it common practice for employers to ask for a resignation when employee is being released due to lack of available work?

Riverside, CA |

Is it a common practice for employers to ask for a resignation when it has been explained to the employee that he is being terminated due to lack of work?

This employee is being offered separation pay and in the separation agreement it asks for the employee's resignation in exchange for his consent to the agreement. The agreement also details the standard compliance obligations, confidentiality, and release of claims and waivers.

Attorney Answers 3

  1. What you are describing is a voluntary severance agreement. California employers are not required to pay severance, but if the employer makes an offer of it there are always terms that the employer wants in exchange. If you accept the severance package, the employer avoids the potential of any legal claims or lawsuits by you, and also avoids any claim by you for State unemployment benefits.

    It is usually a relatively straight-forward calculation to determine whether the offer is generous enough to forego the probability of unemployment benefits (no apparent issues of employee misconduct) and the waiver of any rights to make a legal claim. An attorney can certainly help you compare and contrast the money values of the two options.

    My responses to questions on Avvo are never intended as legal advice and must not be relied upon as legal advice. I give legal advice only in the course of an attorney-client relationship. Exchange of information through Avvo's Questions forum does not establish an attorney-client relationship with me. That relationship is established only by individual consultation and execution of a written agreement for legal services.

  2. I would say it is not common for an employer to ask for a voluntary resignation. That would typically signal an employer's intent to prevent an employee from being able to collect unemployment benefits.

    However, from you describe, it appears the employer is offering a severance package. No one on this Avvo forum will be able to advise you as to whether such severance package, along with its release of claims and waivers, is more beneficial to you compared to receiving unemployment benefits without having to sign any confidentiality agreement or waiver of rights.

    You need an employment attorney to review the separation agreement.

    Frank W. Chen is licensed to practice law in the State of California. The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, consult your own attorney.

  3. To elaborate on Ms. McCall's good response:

    Regarding unemployment benefits, an employer may make the decision to end the employment relationship by layoff or otherwise, and offer the employee the option to resign. If the employee accepts the offer to resign, the employee is still eligible for unemployment benefits because the employee did not leave the last job "voluntarily." The employee had no choice to continue working and did not prematurely end the employment.

    Please see this excerpt from the California Employment Development Department (EDD) web site:

    Quit in Lieu of Discharge
    Title 22, Section 1256-1(d), provides:

    An employee who leaves work when asked by the employer to either resign or be fired, or an employee who resigns rather than agree to a forced leave of absence, has not left work of his or her own free will. In these situations, since the employee did not choose to quit, the employer is the moving party in the separation and the employee becomes involuntarily unemployed.

    When an employer allows a claimant to resign rather than be discharged, the option is usually given because the employer does not desire to affect the claimant's future employment possibilities with other employers by reporting his termination as a discharge. All such "resignations" will be characterized by the fact that the claimant had no choice relative to remaining employed. If he didn't resign, the employer would have discharged him. In such cases, the claimant's leaving is involuntary and will be treated as a discharge.

    In P-B-218, the claimant was accused of using abusive language to a co-worker. The claimant was given the option of resigning his position or being discharged. The claimant chose to resign. In holding the separation a discharge, the Board stated:

    . . . [T]he claimant's forced resignation was in no sense voluntary. If he had not resigned, he would have been discharged. Having no real voluntary choice in the matter of continuing his employment, we hold that he was discharged by his employer. . . .

    *** All legal actions have time limits, called statutes of limitation. If you miss the deadline for filing your claim, you will lose the opportunity to pursue your case. Please consult with an experienced employment attorney as soon as possible to better preserve your rights. *** Marilynn Mika Spencer provides information on Avvo as a service to the public, primarily when general information may be of assistance. Avvo is not an appropriate forum for an in-depth response or a detailed analysis. These comments are for information only and should not be considered legal advice. Legal advice must pertain to specific, detailed facts. No attorney-client relationship is created based on this information exchange. *** Marilynn Mika Spencer is licensed to practice law before all state and federal courts in California, and can appear before administrative agencies throughout the country. She is eligible to represent clients in other states on a pro hac vice basis. ***

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