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Employee’s change of heart upheld by Ontario Court of Appeal

An employer should make inquiries to ensure the employee truly understands the finality and impact of their decision
employment law
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By Brittany Taylor

Many people would assume that an employee providing their employer with notice of resignation would result in a pretty clear-cut end to the employment relationship.

However, like many things in employment law, this situation can be much more complicated than it might appear. The courts in Canada have emphasized that an employee’s resignation must be clear, unambiguous and voluntary. Where these elements are not present, it may be possible for an employee to argue that the resignation was ineffective.  

We have seen cases in the past where an employee resigns verbally in a highly emotional state, and then is allowed to rescind their resignation the following day once they have calmed down. This is fairly clear-cut, and most employers know better than to accept a resignation on its face when the employee is in an emotionally compromised state.

But what about when an employee resigns for a specific reason — and that reason later disappears?

This was the case in English v Manulife Financial Corporation. The employee, then in her early 60s, provided her employer with a resignation letter in October 2016 after she was advised that they would be implementing a new computer system. She was concerned about her ability to learn a new system so close to what she considered to be the end of her career. Her letter indicated that she would retire at the end of the year, but would “entertain a part-time position” should it be possible. 

When her supervisor received the resignation notice, he asked her if she was sure, to which she replied “not totally.” The supervisor advised her that she could reconsider and change her mind, rescinding her resignation, if she wanted to.

Less than three weeks later, it was actually the employer that reconsidered its decision — it announced that it would be suspending the computer system change “indefinitely.” 

Upon hearing this news, the employee immediately advised her employer that she wanted to rescind her resignation. Her supervisor did not indicate there would be any difficulty with this, and acknowledged the withdrawal of her notice. He advised HR accordingly and asked for instructions.

One month later, the supervisor advised the employee that the employer would not recognize a rescission of her notice. On Dec. 12, 2016, she was told not to come back to work.

At trial

At trial, the court found in favour of the employer, noting that the employee’s resignation had been clear and unequivocal. There was no ambiguity in the written notice of resignation provided by the employee. As a result, there was no obligation on the employer to rescind her resignation.

On appeal

The employee successfully appealed. The Court of Appeal found that the employee’s resignation letter was not at all clear and unequivocal. In fact, her resignation was clearly equivocal given the fact that she advised her employer that she was not sure about her decision at that time. The supervisor had acknowledged this by telling her that she could reconsider if she wanted to. The court found that the employer was bound by the supervisor’s promise that the employee could change her mind. 

As a result, the Court of Appeal found that the employer had, in fact, terminated her employment on Dec. 12, 2016, and that she was entitled to damages for wrongful dismissal. The employee was awarded 12 months of pay in lieu of notice.

Takeaway

In this case, when the employer reversed the proposed change that had been the impetus behind the employee’s resignation, the basis for that resignation disappeared. It is not clear from the decision, however, that this alone would have provided the worker with the ability to withdraw her resignation.

It was the supervisor’s promise that she could change her mind that was the employer’s downfall in this case. If, when the supervisor asked the employee whether she was sure about her resignation, he had confirmed that her decision would be final and she would not be able to later change her mind, this case may have had a very different outcome.

Employers must always be alert to the potential vulnerability of a resignation that is given in abnormal circumstances, such as an employee being upset, uncertain or if the resignation comes on the heels of a change in the workplace that could be the underlying cause.

It is in the employer’s best interest to make inquiries to ensure that the employee truly understands the finality and impact of their decision, and not to make promises about the employee’s ability to revoke that decision if circumstances change in the future.

Brittany Taylor is a senior associate at Rudner Law in Toronto. She can be reached at (416) 864-8502 or brittany@rudnerlaw.ca.

© Copyright Canadian HR Reporter, HAB Press. All rights reserved.

Stuart Rudner

Stuart Rudner, Employment Lawyer and MediatorStuart Rudner is the founder of Rudner Law (RudnerLaw.ca), a firm specializing in employment law. He is a senior employment lawyer, mediator and arbitrator. He can be reached at stuart@rudnerlaw.ca, (416) 864-8500 or (905) 209-6999, and you can follow him on Twitter @RudnerLaw.
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