Digest of Benefit Entitlement Principles   Chapter 6 - Section 3

6.3.0 Voluntary leaving defined

Budget 2021 measures alert – Temporary measures are in place from September 26, 2021 to September 24, 2022 which affects the following information:

  • only the last reason for separation (employment before the initial claim for benefits with the latest last day paid) or any employment within the benefit period requires adjudication if the reason for separation is contentious

Simply put, voluntarily leaving means that the claimant and not the employer took the initiative in terminating the employer-employee relationship.

Subsection 29(a) of the Employment Insurance Act defines employment to be considered for the purposes of sections 30 to 33. It states:

29. For the purposes of sections 30 to 33,

  1. "employment" refers to any employment of the claimant within their qualifying period or their benefit period;

Therefore, these provisions apply where a claimant leaves any employment, whether the employment is insurable or not. The only exception to this is where the non insurable employment is for employment under a contract for service which means the claimant is self-employed in the operation of a business that provides a service without setting up an employer-employee relationship.

Subsection 29 (b.1) of the Employment Insurance Act states:

(b.1) voluntarily leaving an employment includes

  1. the refusal of employment offered as an alternative to an anticipated loss of employment, in which case the voluntary leaving occurs when the loss of employment occurs,
  2. the refusal to resume an employment, in which case the voluntary leaving occurs when the employment is supposed to be resumed, and
  3. the refusal to continue in an employment after the work, undertaking or business of the employer is transferred to another employer, in which case the voluntary leaving occurs when the work, undertaking or business is transferred;

Subsection 30(1) of the Employment Insurance Act states:

A claimant is disqualified from receiving any benefits if the claimant lost any employment because of their misconduct or voluntarily left any employment without just cause, unless

  1. the claimant has, since losing or leaving the employment, been employed in insurable employment for the number of hours required by section 7 or 7.1 to qualify to receive benefits; or
  2. the claimant is disentitled under sections 31 of the Act to 33 of the Act in relation to the employment

Subsection 30(7) clarifies that "any employment" referred to in EIA 30(1) means that even though a claimant may not have lost or left their last employment voluntarily, they may still be disqualified due to their separation from another employment. It also stipulates that the claim need not be an initial claim for benefits.

The question to be asked is, "Did the employee have a choice to stay or leave"? Footnote 1

Even though a voluntary separation generally results in a final severance of the employment relationship, this is not always the case. A temporary separation may exist as in the case of a leave of absence taken from employment. These situations are also considered voluntary leaving but are dealt with under a different section of the Act. In situations where individuals take a leave of absence from a job but fail to prove they had just cause for so doing, they would be subject to a disentitlement pursuant to section 32 of the Act.

Additionally, voluntary leaving that occurs within 3 weeks of the employment's scheduled end date is dealt with under section 33 of the Act Footnote 2 .

When dealing with the issue of voluntary leaving, one must distinguish whether the employee truly left their employment voluntarily or whether instead the separation was a form of veiled dismissal. This is called constructive dismissal.

How can one determine whether a loss of employment amounts to constructive dismissal? The phrase "constructive dismissal" refers to situations where the employer has not directly fired the employee. This question can be one of the more difficult ones to recognize when looking at the reasons for separation. It may look at first glance like the claimant quit their employment but upon further fact finding the information shows that rather than fire the employee, the employer made the situation so intolerable that the claimant had no alternative but to quit Footnote 3 .

Whether or not the separation is voluntary can often be a complex issue with some cases being more straightforward than others. Circumstances may exist at times which make it difficult to conclude whether or not the case is one of voluntary leaving. The following sections illustrate various situations which may be encountered.

6.3.1 Voluntary leaving versus misconduct

Budget 2021 measures alert – Temporary measures are in place from September 26, 2021 to September 24, 2022 which affects the following information:

  • only the last reason for separation (employment before the initial claim for benefits with the latest last day paid) or any employment within the benefit period requires adjudication if the reason for separation is contentious

There are situations where it may be difficult to determine if the loss of employment was due to misconduct or voluntary leaving Footnote 4 .

The notions of dismissal for misconduct and voluntarily leaving may be two distinct abstract notions, but they are dealt with under the same section of the Act. In each case, the claimant has acted in such a manner that loss of employment resulted. These two notions are rationally linked together because they both refer to situations where loss of employment results from a deliberate action of the employee. The two notions have also been linked for very practical reasons: it is often unclear from the contradictory evidence, especially for the Commission, whether the unemployment results from the employee's own misconduct or from the employee's decision to leave voluntarily. In the end, since the legal issue is a disqualification under subsection 30(1) of the Act, the finding can be based on either or both of the two grounds for disqualification as long as it is supported by the evidence. There is no prejudice to a claimant in so doing Footnote 5 .

These notions may also become a mixed issue in specific circumstances where the voluntary leaving is the result of misconduct when, for instance, following the loss of their driver's licence, a claimant left rather than being laid off or when a claimant quit their job after being sentenced to a federal penitentiary and did not want to advise their employer of the situation because they preferred not to be fired Footnote 6 .

This does not mean the adjudicator may simply determine the loss of employment somehow resulted from the claimant's own actions. The Commission must gather and evaluate the facts. The final decision must reflect the facts considered and why a determination of dismissal due to misconduct, or voluntary separation without just cause, is more valid. It would involve who initiated the act of severing the employment and the reasons behind this decision.

Should it be determined that the reason for separation is dismissal, then the guidance in Chapter 7 of the Digest should be followed.

6.3.2 Voluntary lay-off

Whenever a claimant requests a lay-off from their employer, for example when a claimant voluntarily opts to be laid off to allow younger employees to continue working or even as per a clause in the union agreement, when a claimant accepts to leave his employment for what he terms "inverse seniority" , this nevertheless constitutes voluntarily leaving employment. It does not matter if the request for lay-off preserved the employment of someone else. The argument that one employee had to be laid off in any event and that the Commission should not concern itself with identifying which employee was to have been laid off does not alter the voluntary nature of the separation.

However, under an employer's work force reduction process, an employee could voluntarily leave their employment thereby preserving the employment of a co-worker. The subject of work-force reduction processes will be discussed in more detail later in the chapter Footnote 7 .

Additionally, a lay-off resulting from a request to have one's employee status changed from permanent to seasonal or because of a decision to work only until a replacement is obtained also amounts to voluntarily leaving employment. In these cases, the claimant surrenders full time permanent employment for a known risk of unemployment.

6.3.3 Leaving prior to anticipated lay-off or end of term of employment

Budget 2021 measures alert – Temporary measures are in place from September 26, 2021 to September 24, 2022 which affects the following information:

  • only the last reason for separation (employment before the initial claim for benefits with the latest last day paid) or any employment within the benefit period requires adjudication if the reason for separation is contentious

When one leaves their employment in anticipation of either a lay-off or the expiration of a term of employment, this constitutes a voluntary separation. This may happen in situations where the employment was expected to terminate for a number of reasons such as a shortage of work, a seasonal shut-down, the sale of a business, or a bankruptcy. However, it does not include situations where a claimant leaves their employment in anticipation of a dismissal for misconduct.

If the claimant advises that they left prior to a planned lay-off or to an expiration of a term of employment in the case of an employment for a set term, the question to be determined is the date of lay-off or the date the term expired.

If the claimant leaves their employment within three weeks before the expiration of a term of employment or the expected date of lay-off in accordance to a notice already given by their employer, the separation will be adjudicated under Sections 29 and 33 of the Act. The adjudicator must still determine whether the claimant had just cause for voluntarily leaving the employment when they did. If just cause is not shown, the claimant will be disentitled from the first day the voluntary leaving takes effect (which is generally following the last day worked) up to and including the date the employment was to end i.e. until the expiration of the term of employment or the day on which the claimant was to be laid off.

If however the claimant leaves their employment more than 3 weeks before the lay-off or the end of a term of employment, the separation will be adjudicated under sections 29 of the Act and 30 of the Act and they may be subject to an indefinite disqualification.

6.3.4 Dismissal prior to voluntary leaving

Sometimes when an employee submits their notice of resignation to their employer, the employer may decide to release them prior to the effective date in the notice. In these situations, the separation is still considered to be voluntary unless they are dismissed for misconduct. I n recent history, there have been a number of decisions that conclude that while it may have been the claimant's action, through submitting the resignation letter, that initiated the series of events ending in their dismissal Footnote 8 , it was ultimately the employer's act which severed the employer-employee relationship and caused the employee to leave Footnote 9 .

The fact that the employer shortened the notice period does not alter the fact that the claimant voluntarily terminated their employment relationship. Any applicable disqualification will be effective from the week in which the date of resignation falls.

In considering the reason for the voluntary leaving, it is the circumstances which exist at the time the claimant leaves their employment that are to be considered as relevant. The circumstances that may occur after that time do not have any bearing on the reason the claimant left the employment Footnote 10 .

When an employee submits a notice of resignation and the terms and conditions are accepted by the employer but the employee is released due to misconduct prior to the agreed upon date of resignation, and for reasons unrelated to the resignation, the separation must be considered misconduct and adjudicated according to Chapter 7.

What follows is a brief description of some of the situations which may occur when a notice of resignation is tendered and how these situations should be approached.

6.3.4.1 Notice period not worked - no compensation for the notice period

There are occasions where a claimant gives the employer notice that they are leaving on a specific date and the employer advises the claimant to leave prior to that date. If the employer does not keep the claimant on the payroll for the notice period, the adjudication should be based on the voluntary leaving criteria. Any applicable disqualification however will be effective from the original date of resignation specified by the claimant to the employer.

An example of this would be a claimant who submits their notice of resignation on December 15 to become effective January 1. The employer informs the claimant that their services are no longer required and they are removed from the payroll effective December 15. This is a case of voluntary leaving and the applicable disqualification would be effective January 1.

This approach is applicable to cases where the claimant provides a notice of resignation for a date in the near or distant future (i.e. tenders notice January 1 and the effective date of the resignation is June 1. Adjudicators must ensure that a formal notice of resignation occurred (verbal or written) and not that the claimant made a statement to the effect that they "planned" on seeking other employment or that they were thinking about leaving their employment.

6.3.4.2 Notice period not worked - compensation received for the notice period

Situations where, upon receiving the notice of resignation, the employer advises the claimant to leave immediately but continues to pay the claimant up to the effective date of resignation as specified by the employee, are cases of voluntary leaving rather than a "dismissal prior to voluntary leaving" and therefore must be adjudicated according to the voluntary leaving provisions.

This would be the case where the claimant submits a notice of resignation on December 15 to become effective January 1, the employer informs them their services are no longer required but continues to compensate them up to the notification date of January 1. Again, this is a case of voluntary leaving and any applicable disqualification would be effective January 1.

6.3.4.3 Notice period not worked - partial compensation for the notice period

Situations where an employer partially compensates the claimant for the notice period are still cases of voluntary leaving. Any applicable disqualification is effective from the date of resignation, as specified by the employee.

An example of this would be where a claimant submits a notice of resignation on December 27 to become effective January 15. The employer, in turn, informs the claimant that their services are no longer required and removes the claimant from the payroll January 3. This is a case of voluntary leaving and although the interruption of earnings occurs January 3, any applicable disqualification would be effective January 15.

6.3.4.4 Dismissal prior to the end of the notice period (for reasons of misconduct)

When an employer dismisses the claimant prior to the notice date alleging misconduct, the adjudication principles for misconduct are to be used. The act that caused the dismissal could have occurred prior to the claimant giving notice or after the claimant gave notice. In either case, when fact-finding is complete, the adjudication principles in chapter 7 of the Digest would be applied. If misconduct is not proven, a subsequent disqualification cannot be imposed for the voluntary leaving.

For example, a claimant submits a notice of resignation on December 27 to become effective January 15. Both parties agree to the terms and conditions of the resignation but on December 31 the claimant violates company policy and is immediately dismissed as a result of that action. This is a case of misconduct and any applicable disqualification becomes effective December 31.

6.3.4.5 Voluntary leaving prior to the end of the notice period

When a claimant submits a resignation and the employer agrees to the terms and conditions but the claimant decides to leave earlier than the date specified in the original agreement, this constitutes a clear case of voluntary leaving and should be adjudicated accordingly.

This would mean that if a claimant submits a notice of resignation on December 1 to become effective January 15, but on December 5, the claimant notifies their employer that they have had a change of plans and want to leave immediately, the reasons for the resignation on December 5 are applicable and must be examined and adjudicated accordingly.

6.3.5 Withdrawal of notice of resignation or of dismissal

When an employee unsuccessfully attempts to withdraw a notice of resignation previously given to the employer, the separation is nevertheless considered voluntary. This same principle applies as well to a person who requests to be re-hired once the resignation has taken effect.

When an employer withdraws a notice of dismissal previously given to the employee but the employee nevertheless decides not to remain in the employer's service, the separation is considered voluntary.

6.3.6 Refusal to continue or resume employment

Voluntary leaving employment also includes situations where claimants:

  • Refuse employment offered as an alternative to an anticipated loss of employment;
  • Refuse to resume an employment; and
  • Refuse to continue in an employment after the work, undertaking or business of the employer is transferred to another Footnote 11 .

It is not uncommon for a person's services to be required beyond the expiry date agreed to in the initial contract. Failure to take advantage of the opportunity to continue in employment, either by extending or renewing the contract amounts to voluntarily leaving employment. Where a claimant was offered an extension at the end of her contract but refused due to failure to reach agreement on a salary increase, it was found that she had refused employment offered as an alternative to an anticipated loss of employment in which case the voluntary leaving occurred when the loss of employment occurred Footnote 12 .

In the Armed Forces however, failure to re-enlist for a further term of service shall be regarded as voluntarily leaving with just cause. This is because employment in the Armed Forces is considered more of a calling to duty than a means of livelihood. This does not however include situations where the leaving is before the anticipated end of contract.

In teaching, most contracts are renewed automatically from year to year. A teacher's decision not to renew a contract for the coming year constitutes voluntarily leaving employment.

When a leave of absence is granted by an employer, it is considered that an employment exists at the end of the leave period. Failure to return to work at the end of the agreed upon leave of absence is voluntary leaving.

Failure to resume employment is also voluntary leaving. The voluntary leaving occurs at the point when the employment was supposed to be resumed. To resume an employment presupposes that the claimant's employment was there to return to and this was known at the time of the lay-off. Although a recall must exist at the time of the lay-off, it does not have to be a known recall date. Nonetheless, there must be a notion that the claimant knew that they were to be recalled. This knowledge may be through an actual recall date, by seniority rights, by custom for seasonal or temporary workers, or even by a verbal arrangement with the employer. In conclusion, there must be some plan, understanding or arrangement whereby the claimant's employment is to restart some time in the future. Furthermore, the job that is available when recalled does not have to be the exact same duties, position or job.

A person, who is temporarily suspended from duty as a disciplinary action, may decide to make the separation final and refuse to resume their employment. Their failure to resume their employment at the conclusion of the period of suspension is considered to be voluntary leaving Footnote 13 .

Additionally, in a situation where the claimant will not continue in an employment after the work, undertaking or business of the employer is transferred to another employer and the new employer has offered employment with no break in service, the voluntary separation will be considered to have occurred at the point where the work or business of the employer is transferred. This could apply to cases where the company is privatized or merged with another but the employment continues within the private or merged company. It does not matter whether or not the actual work was the same.

6.3.7 Seniority rights not exercised

Failure to exercise seniority rights which would enable a person to continue in employment generally amounts to voluntarily leaving employment. This is true whether the employment was to continue without interruption on the same premises or at different premises.

A contention that another employee would have been released is without merit. The very purpose of seniority rights is precisely to give employees with longer service the right to replace junior employees.

It happens sometimes that a labour agreement contains an inverse seniority clause under which employees with longer service can be laid off first. It will be considered that the separation is voluntary for those employees who could have remained employed had they requested it or exercised their rights.

6.3.7.1 Suspension of seniority rights during a temporary lay-off

Occasionally employers reach an agreement with representatives of their employees whereby the parties agree to temporarily relinquish seniority rights during layoffs. Such agreements avoid temporarily replacing staff who are skilled and experienced in a given sector of the business with employees from another sector selected solely on the basis of their seniority, but who may be less effective and may have to be trained. This allows employers to continue business activities in a viable and competitive way.

Not exercising seniority rights under normal circumstances constitutes voluntary leaving. However, if the loss of employment is as a result of an agreement between the employer and the representatives of their employees to temporarily suspend seniority rights, and all the conditions described below are present, then the loss of employment will be deemed a layoff.

  1. The agreement between the parties to temporarily waive seniority rights of employees of a sector of activities must be for a limited period, applicable only during temporary lay offs; and
  2. Approval of all the employees protected by the seniority clause – not only those subject to the lay-off - is required before their representatives may negotiate with the employer; and
  3. Neither the approval nor the agreement itself can refer to specified or named individuals. It is sectors of activities that are affected by the agreement, not individuals; and
  4. Once the seniority rights are suspended, it is essential that the lay-offs be determined by the business needs and that the individuals have no personal choice to be laid-off or not; and
  5. These agreements or "letters of agreement" are not replacing the collective agreement in effect, but rather, are only temporarily suspending the provisions of the collective agreement dealing with seniority rights; and
  6. These must be documented, bona fide agreements, which are not made to circumvent the EI Act or to give advantages to certain individuals.

These agreements cannot be unilaterally extended by the employer. If it becomes necessary to extend the provisions, a new agreement must be re-negotiated between the parties.

This situation must not be mistaken with that outlined in Section 51 of the Employment Insurance Regulations (EIR) (work force reduction) which applies to situations in which claimants have voluntarily left their employment and where there have been measures taken to permanently reduce the employer's work force and to protect the jobs of other workers Footnote 14 .

6.3.8 Transfer or change in duties not accepted

A refusal by an employee to be transferred to other premises or to accept a change in duties is considered as voluntarily leaving employment. This applies even if a transfer procedure or the transfer itself is not part of the employer's contract of service. Further, a person who will not continue in an employment upon the employing company being relocated will be regarded as voluntarily leaving employment. Thorough fact finding and consideration of all circumstances will determine if the claimant has shown just cause.

This principle also applies to persons enrolled in the Canadian Forces who choose to end their contract with the Regular Force and leave their employment because of their transfer. It is a basic condition of service in the reserve and regular forces that a person accepts a transfer Footnote 15 .

6.3.9 Threat of resignation or of dismissal

Separating from employment upon an employer's invitation to do so, after having first threatened to leave, constitutes voluntarily leaving employment. Likewise, a statement made to an employer as an ultimatum that if working conditions are not changed one would cease their employment, amounts to voluntarily leaving if it results in the termination of the employment Footnote 16 .

Cases may arise where an employee is faced with making a choice between being dismissed or complying with an employer's rule. Such an apparent dismissal is but a voluntary separation in disguise, since the employee's decision to choose the option leading to dismissal is one made on one's own.

This applies in cases where the employee chooses to be dismissed rather than undergo a medical examination, subscribe to a group medical plan, pay union dues, accept a change in working hours or rather than withdraw accusations against the employer. The principle also applies in the following cases which could be subjected to the misconduct provision: the refusal to wear a tie or a cap, to work overtime, to obey an order or to forego an unauthorized leave of absence.

On the other hand, when resignation is submitted as the only alternative to dismissal, the question is one of misconduct rather than voluntary separation. In such cases it may be that an individual's employment would be terminated anyway, but they wish to show quit instead of fired on their record. The true reason for separation must be clarified and adjudicated accordingly.

It is uncertain in some instances whether a person in fact leaves voluntarily or whether it is actually a constructive dismissal when there are many indications that all the employer was trying to do was get rid of a particular person for one reason or another Footnote 17 .

6.3.10 Separation by mutual agreement

Instances sometimes arise where an employer and employee both agree that their relationship is to be terminated. A personality clash may exist, an employer's requirements may change, or the employee or the job may be found unsuitable.

Instead of accepting immediate separation, the claimant should attempt to stay on until other work is found. Failure to do so will be regarded as a voluntary separation, unless there are indications that the employer would have refused to extend the employment relationship.

In such situations where there is the option, if a claimant makes the choice to leave, they are seen to be doing so voluntarily and therefore are required to show that the situation was such that they had no other reasonable alternative but to leave their employment Footnote 18 .

6.3.11 Separation attributable to third party

Situations exist where claimants resign their positions although there is no problem with either their employer or the work. Instead, the reason for voluntarily leaving may be attributable to a third party. This could be the case where a person with whom the claimant was travelling decides to leave and there exists no other means of transportation at a reasonable cost and no possibility of moving closer to the place of employment. Another example may be where claimants, under penalty of fine or expulsion, decide to abide by union rules compelling them to leave a particular employment. Both examples are considered voluntary leaving. Once all facts are gathered, the adjudicator must determine whether just cause exists if all reasonable alternatives have been exercised.

6.3.12 Tantamount to leaving or to dismissal

On occasion, a claimant's own actions will lead to their dismissal. In such cases, the reason for separation may be determined to be voluntary leaving. An example of this would be an employee who is attending a course of instruction and informs their employer that they will be less available for work than they were previously Footnote 19 . In this case, the employee is inviting the employer to terminate their employment contract. If the employer dismisses the claimant, it is considered a case of voluntary separation as the dismissal is merely the logical outcome of the claimant's deliberate act of pursuing studies thereby preventing them from being available for work.

Where an employee resigned his position as a driver because he had lost his driver's licence due to non-payment of child support, the Court stated that "it does not matter whether the employer or the employee took the initiative in severing the employment relations where the employment is terminated by necessity and a reprehensible act is the real cause of that termination" Footnote 20 .

In another case, where the claimant's licence was suspended due to an offence committed prior to beginning the current employment as a driver, the claimant argued that he had no reasonable alternative but to quit. It was found that the lack of reasonable alternatives to leaving arose out of the claimant's own actions Footnote 21 .

6.3.13 Termination for absence without leave

Where the employee's absence from work without leave has resulted in the termination of the employment, whether or not the employer considers the loss of employment to be by reason of misconduct should be questioned.

A prolonged absence without notice can nevertheless be interpreted as voluntarily leaving employment Footnote 22 . As a requirement of employment, the employer has the right to expect employees to report for work as scheduled.

When a claimant's vacation request for a specific period was denied by her employer but she chose to continue with her vacation plans and failed to report to work, it was found that she voluntarily left her employment without just cause Footnote 23 .

6.3.14 Taking leave without pay

Budget 2021 measures alert – Temporary measures are in place from September 26, 2021 to September 24, 2022 which affects the following information:

  • only the last reason for separation (employment before the initial claim for benefits with the latest last day paid) or any employment within the benefit period requires adjudication if the reason for separation is contentious

Leave without pay, granted upon request to someone who has decided to stay away from work for a period of time, constitutes a separation from that employment as of the first day of the leave. This separation is considered voluntary. If the period of leave is for a definite period of time, the issue of voluntary leaving the employment will be considered under Section 32 of the Act Footnote 24 .

Once a definite period of leave has commenced, it will be considered that an employment exists at the end of the leave period and any resignation tendered during or at the end of the leave period will be considered as voluntarily leaving employment under Section 30 of the Act.

If there is no confirmed end date to the period of leave, the issue of voluntary leaving will be considered under Section 30 of the Act. In both situations the adjudicator must determine whether there was just cause for voluntarily leaving the employment. Consideration must be given to the reasons for the request of the leave of absence Footnote 25 .

6.3.15 Leaving prior to strike or lock-out

When dealing with cases related to strike or lock-out, Chapter 8 of the Digest which deals with this subject in greater detail, should be consulted.

A resignation given in anticipation of a strike or lock-out, provided such separation is final, amounts to voluntarily leaving employment and not to a loss of employment by reason of the strike or lock-out.

The disqualification for voluntarily leaving employment is from the effective date of the resignation provided that the evidence shows the separation is final.

6.3.16 Leaving during or after strike or lock-out

An employee's refusal to cross a picket line or one's withdrawal of services by reason of a labour dispute does not amount to voluntarily leaving employment, but must be examined along with other activities connected with the dispute at the place of employment.

Should no stoppage of work occur in spite of some employees withdrawing their services, such withdrawal will fall short of proving that they are unable to obtain suitable employment on those days.

When a worker submits a resignation to the employer during such a stoppage of work or which is to take effect during this stoppage, the question to resolve is whether the resignation is genuine and is formally submitted to the employer. If this is so, it may result in a complete and definitive severance of the employer-employee relationship. One shall then consider the possibility of terminating the disentitlement under 36(1) of the Act from the date the resignation becomes effective, provided that the claimant proves that there is no longer a direct interest, participation or financing of the dispute. Such a resignation, provided the separation is final, amounts to voluntarily leaving employment Footnote 26 .

Claimants who refuse or fail to resume their duties after the dispute is settled will be considered to have voluntarily left their employment.

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