What should you do if an employee asks to rescind his or her resignation?

If you really love that employee, you say “Great! Welcome back.” But if this isn’t your favourite employee, you may have an obligation to undo the resignation anyway. In order to decide whether or not to allow them to withdraw the resignation, there are a few factors that you should consider.

First, was the resignation valid? An employee who quits in the heat of the moment or while under duress or emotional turmoil should not be held to their resignation. Similarly, expressing dissatisfaction and raising the idea of resigning, or offering to resign if asked is not, on its own, sufficient to create a valid resignation. An employee will likely be allowed to revoke the offer to resign even after it is accepted, especially if it was made in the heat of the moment.

The timing of the withdrawal is also important. If an employee resigns in the heat of the moment and attempts to rescind in a matter of hours or days, the courts are more likely to conclude that the resignation was not valid. The more time between the resignation and withdrawal, the more likely it is that the courts will allow the withdrawal.

In order to determine if the resignation was valid, the courts use the test: “Given all the circumstances and context in which the resignation took place, would a reasonable person have objectively thought that the employee meant to resign?” That’s lawyer-speak for “Did the employee mean it?” So, for a resignation to be valid, there must be a clear statement of resignation from the employee, preferably in writing; or conduct that clearly shows an intent to resign such as a verbal statement followed by removing personal items from the workplace.

Beyond ensuring a clear resignation, we recommend issuing a written acceptance of the resignation. Employers who scheduled a meeting the next day, or followed up with a phone call to clarify the resignation are generally found not to have accepted a resignation, thus leaving the door open for a retraction. Before issuing an acceptance, employers must also consider other factors that might be influencing the employee such as a potential mental health issue or family situation causing unusual stress. These factors should raise concerns that perhaps the employee doesn’t intend to resign but requires some additional assistance such as a leave of absence or referral to the company’s Employee Assistance Provider.

In some cases, an employee may issue an ultimatum to their employer, in which he or she states that if their conditions are not met, then the employee will resign. If the employee does not rescind the ultimatum after a cooling-off period, likely several weeks, employers have successfully defended their issuance of a written acceptance of resignation. While taking such action would contain the risk of a wrongful dismissal claim, some courts have found the resignation valid where the ultimatum was clear and the employer had given the employee sufficient time to rescind.

If the offer of resignation is not valid, an employer must allow an employee to rescind if the request to retract is brought quickly, even if the offer of resignation has been accepted. In some cases, an employer could refuse to allow an employee to rescind if they can prove that they have relied on the resignation to the employer’s detriment. For example, if an employer had to hire another employee to fill the role, they would have expended both time for hiring and money to pay a replacement because of the resignation of the employee, demonstrating a detrimental reliance.

In summary, give upset employees time to cool down, request employee resignations be submitted in writing, and respond with a written acceptance if there are no suspected factors improperly influencing the employee’s decision. If an employee seeks to rescind the resignation, look at how long it has been since the resignation was issued and what steps have been taken in reliance on the resignation. If there is no down-side in allowing the employee to continue employment, then permitting the retraction is likely the best course of action.