Imagine this tense workplace scenario: Your manager says, “You’re fired,” and in a moment of frustration, you retort, “No, I quit!” While it might seem like a way to regain control, this emotional reaction can have significant legal and financial consequences. Under Canadian employment law, your snap response could jeopardize your eligibility for severance pay and other benefits, including Employment Insurance (EI). This article clarifies why it’s crucial to understand your legal standing during a termination and how an impromptu resignation can negatively impact your entitlements.
When an emotional resignation isn’t legally binding?
The end of an employment relationship can be charged with emotions, but sometimes words spoken in the heat of the moment can lead to legal uncertainty.
Under Canadian law, a valid resignation must be clear, unequivocal and reflect an intention to resign. Canadian courts have found that an employee’s resignation made in anger or during an emotional outburst may not constitute a valid resignation if it does not reflect a clear and unequivocal intention to sever the employment relationship.
In Upcott v. Savaria Concord Lifts Inc., an employee stormed out of the workplace after saying “I’m done…” The court found that his statement and subsequent actions, made in anger, did not amount to a clear and unequivocal resignation. Employers are expected to consider the surrounding circumstances and allow the employee a reasonable opportunity to clarify their intentions before treating such statements as binding.
Implications of insisting you quit instead of being fired
There is a very good argument to be made that it is better to be terminated by an employer than to quit. If your employer has already terminated your employment, your attempt to reframe the departure as a resignation by insisting you “quit,” risks the forfeiting of your legal entitlements.
In Gebreselassie v. VCR Active Media Ltd., an employee of ten years was found to have quit during a heated phone argument with his employer and was therefore denied damages for wrongful dismissal.
Employees who resign are generally not entitled to termination or severance pay. These benefits can amount to significant compensation depending on factors such as length of service and contractual terms. Additionally, they may also lose access to Employment Insurance (EI) benefits. Employees who resign without providing reasonable notice could, in theory, be held liable for damages if their employer suffers financial loss as a result, though such claims are rare.
What to do if your employer say’s “you’re fired”?
If an employer says, “you’re fired”, it is best not to respond by quitting. Preserving the characterization of a termination protects your legal entitlements and allows you to pursue remedies, including wrongful dismissal claims, if applicable.
FAQ’s
What is the legal difference between quitting and being fired in Canada?
From a legal standpoint, the difference between quitting and being fired is significant. When an employee is dismissed without cause, they are generally entitled to statutory and common law severance pay. In contrast, an employee who voluntarily resigns is usually not entitled to such compensation. Moreover, they jeopardize their Employment Insurance (EI) benefits.
Will I lose my Employment Insurance (EI) benefits if I say “I quit”?
Yes, if you voluntarily quit your job without “just cause,” you will generally not be eligible for regular EI benefits. Your eligibility is based on having lost your job through no fault of your own. Saying “ I quit” after being fired creates confusion and threaten your access to benefits.
Can my employer force me to quit?
No. A resignation must be voluntary. If an employer pressures or forces you to resign, the court may still consider it a termination.
What if I quit and then change my mind?
It may be possible to retract a resignation, especially if it was made in the heat of the moment. However, your ability to do so depends on the circumstances. The longer you wait, the less likely you can take it back.
Protecting your legal rights
A statement such as “I quit” in response to being fired won’t necessarily transform a termination into a resignation but it may create confusion and risk an employee’s entitlement to benefits, as well as the ability to pursue a wrongful dismissal claim. The safest course for employees is to avoid recharacterizing the termination as a resignation and to seek legal advice promptly to ensure they have protected their legal rights.
You can contact experienced employment lawyers at Whitten & Lublin or by phone at 416 640 2667 or online.
Author – Marilou
