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When an employee resigns and leaves your business without any notice, it can put you in a challenging position as an employer. Without having time to prepare for the employee’s departure, it can be extremely frustrating. You may need to plug the gap to ensure your business’ activities continue uninterrupted. Indeed, it can be useful at these times to have a clear idea of the legal responsibilities owed by both the employee and you as their employer. This article will set out those legal responsibilities, what to do practically when an employee resigns without notice, and avoiding situations where an employee may resign without notice.

Your Employee’s Legal Responsibilities When Resigning

Both employees and employers have legal obligations and responsibilities when it comes to resignation. As a starting point, note that employees can resign at any time. Resignations do not require the employer’s consent to take effect. Indeed, you cannot make employees stay in their role or with your business. However, your employee does have responsibilities. If their employment agreement provides for a particular notice period, they must give you at least that amount of notice. Even if the employee resigns verbally, they should formally put their resignation in writing. This is to confirm the resignation for your business’ records and to ensure clarity.

However, if an employee resigns and does not give the amount of notice required in their agreement (if they leave suddenly, without notice), you are still under certain obligations as an employer. While it may be incredibly frustrating, you should avoid taking any steps of reprisal against the employee. You still owe them certain responsibilities as an employer. 

Your Legal Responsibilities When an Employee Resigns Without Notice

You must still act in good faith towards an employee even when they have put you in a challenging position. There are still legal obligations that apply in these situations.

For instance, you must ensure you pay the employee for their time until their last day before resigning without notice. Suppose your business owes the employee money (for instance, in the form of unpaid entitlements like stored annual leave). In that case, you must ensure you pay these to the employee without making unilateral deductions from those payments. 

However, if an employee leaves and does not give their minimally required notice, you do not need to pay them beyond their last day. This is different to situations when you agree with an employee that they can leave the business, and agree to pay them until the end of their notice period. These agreements are voluntary, and you as an employer are not obliged to make them, particularly with employees who leave their role without prior warning.

Avoiding Situations Where Employees Resign Without Notice

It is inevitable that employees will resign and move on from your business from time to time. However, it is certainly best to avoid situations where your employees resign without notice. There are a few steps to take to try to avoid this. The first is to make expectations clear around notice periods, particularly in an employment agreement. Secondly, you should encourage proactive conversations with employees when they are considering looking for other work. 

It is also beneficial to develop good relationships with your employees, with mutual goodwill. Indeed, you should help and support your employees throughout their time with your business. This way they are less likely to act in an unprofessional way when they move on from their role. This is because they will not want to put you and your business in a tough position.

Key Takeaways

It is a difficult situation when employees resign without any notice. Legally, employees must give the notice required by their employment agreement. If they do not, they are in breach of their contract. However, employers are still under legal obligations. This includes paying the employee for their time up until their last day before resigning and being cautious before making any unilateral deductions from their pay. Avoiding these situations altogether is the best solution where possible, aided by clarifying expectations around notice periods and supporting employees when they look to move on eventually. If you would like more information about resignations, including without notice, contact LegalVision’s employment lawyers on 0800 005 570 or complete the form on this page.

Frequently Asked Questions

Is it legal to resign without notice in New Zealand?

Employees are bound by their notice period in their employment agreement and cannot legally resign without notice when their agreement provides otherwise. Despite this, this situation does arise from time to time.

Does an employer have to pay an employee their final pay if they resign without notice?

Yes, an employer must pay an employee for their time but does not have to do so beyond their final day of work if they have resigned without notice. 

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