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Why your company wants you to resign

(MoneyWatch) Dear Evil Hr Lady,

I was told my position was being eliminated last week -- the day before I was leaving for vacation. They are not offering a severance package, and I am able to work for them for three months while I look for another position. They also said that they will treat it as a resignation, and that is what they will tell the rest of the staff.

 If I secure another job, then I can leave prior to October 31. This really bothers me, as I have had good reviews and have not been told my performance was poor. In fact, I have achieved all departmental goals for the year before the third quarter was completed. The only thing that I can think of is that the day before they let me go, I completed a grant project that I had been working on. They did mention money was an issue, but I am probably the lowest paid people in the office. I do not care that they let me go -- I just prefer not to lie to the rest of the staff, and I would prefer to leave now and collect a three-month severance package. 

The way it is now, I have to go work there everyday knowing I am leaving. It is uncomfortable, and I feel used and taken advantage of. I also will not be able to collect unemployment if they say I "resigned." Any advice on how I should proceed? I have thought about contacting an employment lawyer, but I also thought it might be a waste of time.  

It sounds like they are laying you off. You're not being terminated because of poor performance. They are likely ending your job because of financial reasons. And companies who are ending employment for financial reasons hate, with a burning passion, paying for unemployment.

Now, you may think that unemployment is a state benefit, so why would your employer care? Because even though the state writes the checks, the companies pay for it (generally through a tax) that varies depending on how many of their former employees qualify for jobless benefits. They hope you'll resign so they won't have to pay unemployment. Another trick companies use is creating some trumped up reason for firing you. If you're fired for cause, you're not eligible for unemployment either.

You should know, however, that it's possible to collect unemployment even if the stated reason for termination is "resignation." You have to apply for unemployment. The company will be given the opportunity to object, and then each side will have a chance to present their case. They will show the letter of "resignation" that they wrote and you signed. You will need to present proof that it was their idea.

That means you should get any related communications in writing. Forward any emails you've received on this to your personal email account as soon as possible. 

While coming to work is awkward, and you feel like you're lying to your coworkers (who, by the way, don't have a right to know why you are leaving), everyone is likely to deduce that you are being terminated. People don't resign three months in advance without big plans lined up. 

But having your co-workers know you're being laid off (which is what's going on here) is still awkward. And while it's painful for you, it does give you one big advantage -- it's easier to find a job when you have a job. Being able to put the dates on your resume as "January 2009-Present" looks a heck of a lot better than "January 2009-August 2012." With the latter you get a bunch of questions about why are not working anymore. And while there is no shame in being laid off (it happens to, honestly, the best of people), some companies just do not hire the unemployed.

Now, can you ask for severance in lieu of working those last three months? Of course. Will they give it to you? Hard to say. My guess is no, since your company is trying to make it look like you resigned. Do I recommend it? No. Painful though it may be, your chances of finding a good new job are lessened by being unemployed, even though you have more time to devote to searching for work.

So my advice is to smile, work through it, and devote as much time and effort as possible to finding a new job. If you don't have one by the time October rolls around, gather your documentation and apply for unemployment anyway. Chances are you'll get it.

Have a workplace dilemma? Send your questions to

For further reading:

Forced to resign: What are your options?
Why I quit my job without a new one lined up
Can you be fired for working through lunch?

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