When an employee resigns, for whatever reason, it’s important that as an employer you respond in the right way, so you can protect your interests and minimise liability.
In January 2022, 4,258,000 people quit their jobs to perhaps further their careers elsewhere or try something new. That’s an enormous number and one that demonstrates that no job is for life. With quitting now part and parcel of today’s working environment, and even if it’s a shock, it’s not something you can stop from happening. So, don’t give into the emotion, instead keep a clear head and follow a written down procedure, to ensure you not only have complete awareness of the legal and commercial risks that arise when someone leaves but are also able to stay compliant.
I’ve put together the following checklist to help you to successfully navigate this potential minefield:
- Talk to the employee, face-to-face is best, find out what type of resignation it is, heat of the moment where retraction is likely, a new job/pursuit of a new opportunity elsewhere, an exciting promotion, or whether the employee believes that its constructive dismissal. Obviously, the latter may mean that they could bring a claim, so it’s important to find out more and try to limit the risk at this time if you can.
- Ensure the resignation has been done correctly, i.e., in writing (email or letter), at a meeting or verbally, basically it needs to concur with what is written in their employment contract. Regardless about how you are told, it’s good to have a private conversation with them afterwards to talk about the next steps.
- Length of notice. Once again you will need to check their employment contract to find out what their length of notice is. If there is some disagreement about it, try to work out what might be reasonable in their specific circumstances. Remember if you agree one that is shorter than the one in their contract, there could be tax consequences that need addressing.
- Working notice. In some cases, keeping someone in the business is helpful to ensure a productive handover. On other occasions they might become disengaged and less productive. In the latter instance, gardening leave or paying them in lieu of their notice might be preferable to decrease levels of disruption. But be careful here because you don’t want their resignation to be interpreted as a dismissal.
- Paying in lieu of notice. If this is the option taken, then once again the contract of employment should prove invaluable in specifying how to calculate what wages are due. However, it might not include compensation for the loss of their benefits which might include car allowances, commissions, bonuses, pension contributions and other reimbursements, so you might need to work these out separately.
- Refusal to work notice. What should you do if they refuse to work all their notice, perhaps they are eager to start their new job sooner than their full notice allows. It’s worth saying that you can’t force them to work it, but you as an organisation, you might be able to claim damages for the extra costs incurred if they leave early. Alternatively, you could try to discourage this behaviour by highlighting the fact that your reference for their new job will state how they failed to work their notice.
- Holiday pay. Time to work out if they have taken too much or too little holiday. Too little and you can simply calculate what is owing. Too much and you might need to deduct that amount from their final pay as per their employment contract.
- Conduct an exit interview. Ask lots of questions to find out their reasons for leaving, find out what they liked and didn’t like about working at your organisation. Make notes and perhaps if there are any patterns, you can look to make some suggestions/changes. This is also a suitable time to remind them about returning items that belong to the company, point out any confidentiality and post termination-restrictive covenants and ensuring you have the right contact details for sending on anything after they leave.
- Return of company property. Before, or during their last day, you must collect any company property you provided to them. This might include, car, laptop/tablet, phone, credit/fuel card, keys, key cards, private and sensitive paperwork etc.
- Remove employee access. After they leave, they should no longer have access to anything at your organisation, whether that’s access into the building or access into your computer systems. Update your payroll and HR software and ensure the employee has been removed from the website, intranet or other internal/external promotional channels. Disabling or forwarding their email address might also be prudent.
How can I help?
For further advice, support or information relating to resignation, email caroline.robertson@actifhr.co.uk