As an employer, you may at times have an exiting employee approach you to request that their voluntary resignation be processed by the Company as being a termination. Such a request would generally be made by an employee so as to enable them to start claiming welfare benefits (such as Centrelink - Services Australia) sooner than they would have otherwise been able to had they voluntarily resigned from their employment.
In many instances, where an employee has chosen to voluntarily cease their employment by resigning, they will have to wait for a number of weeks before they will be eligible to claim or receive welfare benefits. Such a ‘waiting period’ would not ordinarily apply, or the period would be significantly reduced, had the employee’s employment been terminated by their employer.
While it may be tempting for an employer to accept such a request out of good faith, or as a means to ‘speed up’ the termination (particularly in instances where the employee is already under-performing at work), it is recommend that employers do not agree to do this due to the potential risks of being exposed to an unfair dismissal claim.
Although an employee may request for their employment to be terminated by their employer, in order for an employer to legally terminate an employee, there needs to be a genuine and valid reason for the termination to have occurred. Even in instances where the employee is not performing, a thorough performance management process would need to have been undertaken prior to an individual’s employment being terminated on this basis. Complying with an employee’s request in such circumstances would not constitute a “genuine and valid reason”.
It is also important to note that where an individual’s employment has been terminated by the employer, even where such a termination has been processed at the employee’s request, the employee could still choose to lodge and pursue an unfair dismissal claim. This could leave the employer exposed to a potential unfair dismissal penalty which could include having to pay the employee compensation (which could be up to the equivalent of six months’ salary), or potentially even having to reinstate the employee.
Information in HR Advice Online guides and blog posts is meant purely for educational discussion of human resources issues. It contains only general information about human resources matters and due to factors such as government legislation changes, may not be up-to-date at the time of reading. It is not legal advice and should not be treated as such.