By Howard Levitt
There’s a right and a wrong way to resign. And dramatically barging into the boss’s office and quitting, presuming that will put an end to whatever took place, isn’t the right way.
The concept of providing notice or severance to dismissed employees is commonly understood. However, few employees appreciate that they can be liable for damages to their employer for wrongful resignation and that they have a reciprocal obligation to provide reasonable notice to their employer.
A recent B.C. Court of Appeal case reiterated this. Peter Walker had been an employee of Consbec for five years when he abruptly he precipitously sent his supervisor a resignation letter and left the office, never to return. Consbec sued Walker, noting its losses in having to relocate two employees from Ontario to Kamloops to replace him. These damages included reimbursement for mileage, per diems and moving expenses.
The trial judge agreed, and ruled that Walker was obligated to give reasonable notice of his resignation. Consbec was awarded more than $56,000.
The B.C. Court of Appeal emphasized that the main purpose of reasonable notice is to provide employers with sufficient time to adjust to an employee’s departure. Although the trial judge never stated the amount of notice Walker should have provided, the Court of Appeal found that, in the circumstances, Walker was required to give Consbec a month’s notice.
That being said, the court significantly lowered the amount of damages owed to Consbec to $5,875, explaining that damages should have been assessed based on what Walker’s failure to give notice cost the company, not on the cost of Walker leaving the company, which would be the case even if notice was provided.
Despite the court lowering the amount of damages, the message is clear: Employees can be liable for failing to provide their employer sufficient notice of resignation and no one should assume the traditional two weeks is sufficient.
Here are some important lessons to be drawn from this case:
Do I have to give notice? As much as the idea of absconding from employment as soon as you resign is appealing, employers are just as deserving of notice as are you. The last thing you want is to have your employer sue you for damages. If your employment contract does not specify the amount of notice you are required to provide, your safest bet is to give as much advance notice as possible or negotiate a departure date with your employer.
How much notice are employees supposed to provide? Similar to the factors used to assess how much notice an employer is required to provide an employee, the appropriate notice period will depend on the employee’s duties, salary, length of service, and the time it would take the employer to hire a replacement or redistribute the work. It is important to note that Peter Walker was not considered a fiduciary. The amount of notice he would have been required to provide Consbec would have been significantly higher if he was.
Is it worth it for employers? Although employers can seek retribution for wrongful resignation, employers should first consider whether they have any recoverable damages. Damages must stem from the lack of notice of resignation specifically, and not from the cost of the employee leaving the company. Sometimes the savings from not having to pay that salary may outweigh the cost of the employee leaving. However, if an employee resigns precipitously and frivolously claims constructive dismissal, a counterclaim for wrongful resignation is worth considering.