Constructive Dismissal

Denying the Change or Resignation

Repudiation or Resignation

Generally speaking, case law has determined that the resignation must be “clear and unequivocal”, based on the employee’s free will. 1 2

The test is twofold. The first issue is whether, viewed subjectively, the employee intended to resign and secondly, when viewed objectively, a reasonable employer would have rationally concluded that this was intended as a resignation. 3 4 5

The context in play at the time of the alleged resignation must be examined to determine the true intent. 6

Where an asserted resignation has been effected in a moment of emotional outburst or “in the heat of the moment”, often the case law has tempered this view by stating it may be unfair for the employer to conclude that there has been a valid act of resignation. 8

The Court of Appeal in Evans affirmed the trial reasons and agreed that it is at this moment that the “overarching duty of good faith takes effect and influences the established doctrines of ‘resignation’ and ‘reasonableness’”. This is ever more so when the employment relationship has been a long one and the employee has shown themselves to be “emotionally and financially vulnerable”.  9

A fair summary may well be that both the employer and the employee should each act fairly and rationally. The employer should not act precipitously and the employee should similarly make their intentions clear: 10

In summary, the broad understanding I take from the authorities regarding the validity of an employee resignation is this: an employer faced with a declaration of resignation cannot always take it at face value, but should consider the context and all the surrounding circumstances.  These are some of the ways in which a resignation can be unclear or ambiguous: in the manner of its expression, or because of conflicting statements made by the employee about resignation; or because of the circumstances it was made in, for example, in a state of strong emotion/mental distress that would raise a doubt in the mind of a reasonable and fair-minded person about the employee’s true intention; or because of some other relevant circumstance, such that an employer, as an objective person, acting fairly and reasonably, would seek a clearer understanding of the employee’s intention before accepting and acting on it.

[110]      At this stage, I note that there are concurrent duties imposed upon an employee as well.  I can find nothing in the cases that suggest that in a case where there is uncertainty or confusion about a statement of resignation, an employer is free to do nothing to clear up the ambiguity; and likewise, the employee should be taking steps to make their intentions clear in such circumstances.  It would not be in the reasonable contemplation of the parties that the employee would be entitled to sit back and make no effort to clarify their true intentions.

A December 2022 Ontario decision considered the argument made by the employer that the plaintiff had provided a clear resignation and had not, in fact, repudiated the employment agreement. The plaintiff had been advised that in four days, her income was to be reduced to zero, in the anticipation of a full lay-off. The plaintiff sought alternate commissioned income and was successful in so doing within one month. She resigned from her prior employment to accept the new position. She did not, in her resignation letter, seek to “reserve her rights” to sue. The trial judge found that this qualifier was not determinative. The claim succeeded. 11

Even if a valid resignation has been provided, it is possible for the employee to resile from it, where the employer has not acted upon this to its detriment. 12 This is what did unfold in a Ontario case. The plaintiff clearly had resigned but withdrew it prior to the employer acting upon it. 13 14

One would expect that a resignation which has been accepted would lead to the argument that a valid contract has been created, one which requires mutual consent to avoid. For example, an employee who offers three months working notice may find the employer agreeing to accept this. It would be difficult to imagine that this agreement may be unilaterally resiled from.

Such was the decision of the Nova Scotia Court of Appeal in 2017. 15

  With respect, the appellant’s statement of the law is wrong.  His position runs contrary to the basic principles of contract law, which hold that all that is necessary to bring a contract to a close is the communicated acceptance of a valid offer (S.M. Waddams, The Law of Contracts, 6th ed….). Whether or not a party relied upon an offer to their detriment is only relevant in cases where the offer has not been accepted.  Once it has been accepted, the contractual bargain (to terminate the employment relationship) has been struck.