Q: If an exempt employee gives a two week resignation notice, do we have to honor it or can we separate early without compensating the employee for the two weeks?

A: An employer may accept the employee’s voluntary resignation, or release the employee in advance of the stated resignation date, or in extreme situations determine if cause exists for early termination (sometimes employees disregard policies after submitting a resignation).

If the employee works through to the resignation date, the employee must be paid for all wages earned through the resignation date. If the employee is released earlier, then the employer must pay wages for all time worked through the termination date. The employer is not obligated to pay the employee for any days not worked through the resignation period when no work is performed, and final wages need only include wages earned through the actual last day worked.

Please note that when letting the employee go prior to the end of the resignation period, the company has effectively changed the resignation into a discharge for the purposes of wage payments, if in fact pay is not provided through the original resignation date, regardless of hours or days worked. The employee may also then be able to file for unemployment since he or she will be missing wages during the resignation period. This liability may not be in the best interest of the employer.

Therefore, it is up to the company whether or not to pay through the resignation period; however, doing so permits the resignation to stand as a voluntary decision on the employee’s behalf.

Question and Answer provided by ThinkHR. Learn more about how your nonprofit can gain access to their expert HR staff here.