Did the Employee Quit in Reasonable Anticipation of Being Fired or Otherwise Discharged from Employment?
A separation is not voluntary if the employer imposed it. An employee who is given the choice of being fired or resigning and resigns, should be treated as fired. AH c.6, § 1A.1. An employee who leaves work because of a reasonable belief that a firing is imminent will not be disqualified under G.L. c. 151A, § 25(e)(1).
In both Malone‑Campagna v. Dir. of the Div. of Emp't Sec., 391 Mass. 399, 461 N.E.2d 818 (1984) (employees who had collectively resigned claimed at the hearing that they did so because they believed they were about to be discharged for refusing to conform to employer’s new, unlawful policies), and Scannevin v. Dir. of the Div. of Emp't Sec., 396 Mass. 1010, 487 N.E.2d 203 (1986) (employee believed he was about to be fired and so failed to submit medical document required to preserve his job), remands were required for findings as to whether the claimants’ beliefs that they were about to be fired were reasonable.
In Gabovitch v. Jurczak, 76 Mass. App. Ct. 1109, 920 N.E.2d 88 (2010) (unpublished), the Appeals Court affirmed a lower court ruling that the employee reasonably believed that her job was coming to an end due to the dissolution of the employing partnership and that she left work for good cause attributable to the employer and was therefore eligible for UI benefits.
If the employer gives the claimant the alternative of quitting or being discharged and the claimant chooses to resign, they the claimant will not be disqualified under G.L. c. 151A, § 25(e)(1), but if DUA determines that the intended discharge would have been for misconduct or a rule violation, the claimant may be disqualified under § 25(e)(2).
Although it is not an unemployment case, practitioners should be aware of the SJC’s decision in Upton v. JWP Businessland, 425 Mass. 756, 682 N.E.2d 1357 (1997), holding that it was not a violation of public policy to terminate an employee at will who, due to her responsibilities as a single parent of a young child, could not work the additional overtime hours that her employer required. The court did note, however, that the Legislature has directed that UI benefits should be available where domestic responsibilities limit a person’s availability to work. 425 Mass. at 756. Therefore, if the employee were discharged, she should not be disqualified under §25(e)(2), and if she resigned in anticipation of discharge, she should not be disqualified under §25(e)(1).
Where an employer does not allow a quitting claimant to work during the course of the two-week notice given by the claimant, the claimant is not disqualified from benefits from the date of notice to the date of quitting, even if the separation would have been voluntary and disqualifying after that two-week notice period. BR-703301 (6/20/14).
A voluntary leaving is not disqualifying under UI law: 1) if the individual leaves her job in good faith to accept a new job on a permanent basis and loses the new job for good cause attributable to the employer; or 2) if the individual leaves because the terms of a pension or retirement program requires the individual’s retirement from that job. G.L. c. 151A, §25(e), ¶3.
In certain cases, an employee who has some control over her date of retirement may still qualify for UI benefits. Thus, in O’Reilly v. Dir. of the Div. of Emp't Sec., 377 Mass. 840, 388 N.E.2d 1181 (1979), an employee who accepted his employer’s proposal to accelerate his retirement by six months was not disqualified from receiving UI since job separation was inevitable. However, an employee will not be deemed eligible if the employee opts for early retirement without reasonable belief that mandatory retirement is inevitable. Klockson v. Dir. of the Div. of Emp't Sec., 385 Mass. 1007, 432 N.E.2d 704 (1982) (finding claimant’s belief that the employer would soon have discharged him unreasonable where the employer had no mandatory retirement policy, several employees older than the 65-year-old claimant worked for the employer, and the claimant had more than 10 years’ seniority).
Employees who reasonably believe they will be laid off will not be disqualified for retiring before the layoff is announced. In White v. Dir. of the Div. of Emp't Sec., 382 Mass. 596, 416 N.E.2d 962 (1981), the claimant accepted a retirement incentive because he had heard rumors of an impending layoff and had limited seniority. He believed that if he did not retire, he would be laid off soon after his retirement date. The Court ruled that, if his belief was reasonable, his leaving was not voluntary. In a subsequent case, the Court held that if the employer created uncertainty about whether the individual would be laid off as part of a reduction in force, then accepting a voluntary severance package does not disqualify one for UI. State Street Bank v. Deputy Dir. of the Div. of Emp't & Training, et al., 66 Mass. App. Ct. 1, 10–12, 845 N.E.2d 395 (2006); Charrette v. Comm'r of the Div. of Unemployment Assistance, 72 Mass.App.Ct. 1114, 892 N.E.2d 837 (2008) (unpublished decision); BR - 0014 7739 42 (9/30/15) (concluding as a matter of law that “because the employer substantially hindered the claimant’s ability to determine the likelihood that he would be involuntarily separated from his employment if he did not accept the employer’s separation package, his decision to leave was for good cause”); BR-0032 1539 27 (3/21/20) (the Board applying the State Street doctrine found good cause attributable to the employer and claimant eligible for benefits where the employer offered an early retirement package and strongly suggested there would be a workforce reduction).
Layoffs and Voluntary Severance Packages
Generally, an employee who is laid off involuntarily is eligible to receive UI. This is true even when an employer’s layoff scheme grants limited discretion to its employees to decide which workers will be laid off. For example, where an employer announces a layoff plan that contains voluntary as well as potentially involuntary components and thereby creates an environment in which an employee is forced to speculate on the likelihood of an involuntary termination, such employee has “good cause attributable to the employer” to leave work and take a voluntary severance package. See State Street Bank & Trust Co. v. Deputy Dir. of the Div. of Emp't and Training, et al., 66 Mass. App. Ct. 1, 845 N.E.2d 395 (2006); Curtis v. Comm'r of the Div. of Unemployment Assistance, 68 Mass. App. Ct. 516 (2007); Charrette v. Comm'r of the Div. of Unemployment Assistance, 72 Mass. App. Ct. 1114, 892 N.E.2d 837 (2008) (unpublished opinion); Connolly v. Dir. of Div. of Unemployment Assistance, 460 Mass. 24, 948 N.E.2d 1218 (2011).
When given a choice by management of remaining at work or accepting a layoff due to a general reduction in the workforce, a claimant who agrees to be laid off is not subject to disqualification. AH c.6, § 1A. This is because it is the employer who decides to lay off staff, and the employer can accept or reject the claimant’s offer. Morillo v. Dir. of the Div. of Emp't Sec., 394 Mass. 765, 477 N.E.2d 412 (1985). However, Morillo is limited to circumstances in which the employer has announced that layoffs will occur and does not provide a financial incentive for employees to choose in lieu of layoff. Connolly v. Dir. of the Div. of Unemployment Assistance, 460 Mass. 24, 28, 948 N.E.2d 1218 (2011) (claimant who accepted severance package was not eligible for UI where she was not compelled to apply for the termination, did not believe her job was in jeopardy, and left in part for personal reasons). In so holding, the Connolly Court found that there was no analytical difference in early retirement and incentive-based termination packages, and that it was not dispositive that the employer had made the final decision in accepting the claimant’s resignation.