News & Insights

Resignation or dismissal

A cautionary tale of when a resignation is not a resignation.

It is generally understood by employers that a notice of resignation from an employee can be taken as read and that such notice cannot be withdrawn except by consent, i.e. an employer has no obligation to accept a retraction of a resignation.  However the recent case of East Kent Hospitals University NHS Foundation Trust v Levy highlights that there are important exceptions where a resignation should not be taken at face value.

Mrs Levy was employed by the Trust in its Records Department.  Having experienced various difficulties in that department she successfully applied for a position in an alternative department subject to pre-appointment checks.  Shortly after receiving this conditional offer she had a disagreement with a colleague in the Records Department and handed her manager a letter stating “Please accept one month’s notice from the above date”.  Her manager responded by letter accepting her notice of resignation and confirming her last day of work within the Records Department.  A few days later her offer of the new role was withdrawn and Mrs Levy sought to retract her notice.  The Trust refused to agree to this and wrote confirming her employment would end at the end of her notice period.  Mrs Levy claimed unfair dismissal.

The key question was whether her employment had been terminated by resignation or dismissal.  The Employment Tribunal (ET) found that, although her letter had been ambiguous as to whether she was giving notice to leave her department or her employment, the Trust understood her intention was only to give notice to leave the department.  The Employment Appeal Tribunal agreed, as the wording in the notice was ambiguous the ET was correct to apply an objective test and consider how the words used would have been understood by a reasonable recipient of the letter.  There were special circumstances that made it unreasonable for the Trust to construe Mrs Levy’s letter at face value.  For example the manager knew she intended to take up work in another department, his letter in response specifically referred to her last day in his department and did not deal with usual termination matters such as accrued holiday, and he did not complete a staff termination form.  She had therefore been dismissed by the Trust when it confirmed her employment would end.

The specific circumstances of this particular case may be unlikely to arise in smaller organisations.  However similar issues can occur in more common scenarios, for example when an employee resigns in the heat of the moment, an immature employee has made a quick decision, or an employee has been jostled into a decision by the employer.  Case law has established that in such special circumstances the employee should be given the opportunity to withdraw a resignation after they have had a reasonable period of time to properly consider their decision.  In addition a verbal resignation may not be valid under the employment contract if it specifically requires notice to be given in writing.

Employers should be aware that, before accepting or otherwise acting upon a written or verbal notice, they need to consider the circumstances in which the resignation was given and satisfy themselves that the employee did really intend to end their employment.  We also recommend that employers always respond in writing to acknowledge a resignation, confirm their understanding is that the employment will terminate and specify any related arrangements.