Threatening to resign, when used by an employee to bargain for better working conditions, is a weapon that cuts both ways. A tactic of this sort can easily backfire on the person making the threat, a point that was illustrated in a recent decision of the Quebec Court of Appeal in De Montigny c Valeurs mobilières Desjardins.1
This case involved a suit filed by a former president and chief operating officer against his ex-employer for more than $3M, claiming constructive dismissal.
Stating that he was dissatisfied with his total compensation, the plaintiff had tendered a letter of resignation to his employer. Orally, he explained that the resignation was to take effect only if the problems related to his compensation were not resolved and if a strategic plan was not established by a certain date. Initially, the employer refused to accept the plaintiff's resignation and reiterated its confidence in him, and the negotiations continued. A few weeks later, the employer had second thoughts and accepted his resignation following the publication of an internal audit report on the compliance practices of a branch for which the plaintiff was responsible.
In first instance, Justice Paul Mayer concluded that tendering the resignation letter had amounted to a pressure tactic aimed at obtaining a salary increase and that, in such a situation, the employer was not required to give in to an employee's blackmail. Moreover, the resignation had been free and voluntary. In the view of the trial judge, the plaintiff had "taken the calculated risk that he might lose his job if the resignation was accepted and now had to suffer the consequences of his action."2
This reasoning was affirmed by the Court of Appeal, which failed to detect any determinative error in Justice Paul Mayer's findings. On the contrary, it went further, noting that "the appellant knowingly used resignation as a weapon to try to achieve his ends"3 and that "the fact that the weapon backfired on him did not make the act of using it less free and more involuntary."4 Based on the foregoing, the highest Quebec court thus went on to dismiss the appeal and reject the appellant's argument that he had been constructively dismissed.
To be sure, this decision makes it clear that an employer will not have to give in to an ultimatum by an employee who brandishes the threat of resignation in an effort to secure certain advantages.
Resignation nevertheless remains an employee's prerogative and must be free and voluntary. Establishing that a resignation was free and voluntary will normally require a court to make a detailed analysis of the circumstances in which it was given. However, the Court of Appeal has now confirmed that threatening to resign cannot be used by an employee as a ploy to get whatever he or she wants and that, at the very least, the employee must be prepared to assume the risks and consequences of resorting to such tactics.
1 2013 QCCA 600, Dalphond, Dufresne and Gascon JJA.
2 Para. 49 of the decision. (our translation)
3 Para. 73 of the decision. (our translation)
4 Id. (our translation)
Norton Rose Group
Norton Rose Group is a leading international legal practice. We offer a full business law service to many of the world's pre-eminent financial institutions and corporations from offices in Europe, Asia, Australia, Canada, Africa, the Middle East, Latin America and Central Asia.
Knowing how our clients' businesses work and understanding what drives their industries is fundamental to us. Our lawyers share industry knowledge and sector expertise across borders, enabling us to support our clients anywhere in the world. We are strong in financial institutions; energy; infrastructure, mining and commodities; transport; technology and innovation; and pharmaceuticals and life sciences.
We have more than 2900 lawyers operating from 43 offices in Abu Dhabi, Almaty, Amsterdam, Athens, Bahrain, Bangkok, Beijing, Bogotá, Brisbane, Brussels, Calgary, Canberra, Cape Town, Caracas, Casablanca, Dubai, Durban, Frankfurt, Hamburg, Hong Kong, Johannesburg, London, Melbourne, Milan, Montréal, Moscow, Munich, Ottawa, Paris, Perth, Piraeus, Prague, Québec, Rome, Shanghai, Singapore, Sydney, Tokyo, Toronto and Warsaw; and from associate offices in Dar es Salaam, Ho Chi Minh City and Jakarta.
Norton Rose Group comprises Norton Rose LLP, Norton Rose Australia, Norton Rose Canada LLP, Norton Rose South Africa (incorporated as Deneys Reitz Inc), and their respective affiliates.
On January 1, 2012, Macleod Dixon joined Norton Rose Group adding strength and depth in Canada, Latin America and around the world. For more information please visit nortonrose.com.
Norton Rose will join forces with Fulbright & Jaworski L.L.P on June 1, 2013, creating Norton Rose Fulbright a global legal practice with significant depth of expertise across the USA, Europe, Asia, Australia, Canada, Africa, the Middle East, Latin America and Central Asia.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.