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Company closing West Coast Operations - Resign or be fired?

by Charles
(Saratoga, CA)


I'm in a sales based role and I work for a UK based company and have been told that they are "Closing down the west coast" (I work from my house in California). This is due to insufficient sales to support our costs.

They've offered to 'let' me resign, and they'll pay me a month of severance. They have said that in future if other employers contact them, they will state that I've resigned (not fired or laid off). They aren't publicly stating that they're shutting down operations on the west coast (worried about negative publicity, I suppose).

My question is, if I do give them a letter of resignation, can I still collect unemployment? The severance would be nice, but I don't want to jeopardize my ability to collect unemployment.

I'm in California.

Hi Charles,

You know what .. I've reread your question a few times now .. and something about it is just bothering me .. it's like you've left something out.

I know you told me they want you to resign before they lay you off .. and Charles there is a difference between a layoff and being fired.

A layoff is a lack of work for which there is no argument for good cause.

A discharge on the other hand requires good cause for termination if they don't want to pay UI benefits.

Since I think I'm missing information I suggest you read the
California Eligibility Guide

If being laid off or quitting with a resignation letter to receive one month severance is the choice .. I wouldn't quit because a Layoff is not a resume killer .. not these days anyway and it would probably be seen as a quit without good cause.

But it is your use of the word fired that is truly bothering me .. and what makes me think something else is going on. This is an entirely different scenario.

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Mar 26, 2010
RE: further Details
by: Charles

Good point, I overlooked that when entering the comment above. The letter they supplied to me does state that they agree to pay one month of severance, plus outstanding Holiday pay.

I should also mention that I did (finally) get through to the EDD. The best answer I could get from them was - "Just file and take your chances". Seriously. Hardly advice. It became apparent very quickly that the person on the phone wasn't very familiar with these things.

I *think* I'm feeling better about this. I'll ring up the HR department in the morning and just ask if they intend to deny my claim. But, I think, even if they did, I could show this letter + the section of code I outlined above showing that the employer is the "moving party" to terminate employment and be ok.

But, it's the gov't, so you never know how things will turn out. I'll keep this link and update it for future searchers, as it may help someone else.


Mar 25, 2010
RE: further Details
by: Anonymous

Another update - my employer has given me a letter that states that they confirm my employment with them will be terminated as of 31 March 10, due to my position being made redundant, and "in no way reflects your performance in your job, which has been entirely satisfactory"

Ok, so it would seem that the above clause does apply to me. Whatever happens, I'm not working for this company any more - they made that clear. So, it would seem that a resignation is fairly harmless at this point - as long as I can collect unemployment benefits, right?

I've been trying to get through to EDD, but their line is swamped. Thanks for all your help!

Hi Charles,

I would confirm that with the EDD, because the way I see things you would be resigning merely to get the one month severance .. and I think the EDD might disqualify you for that.

I would not call the letter you possess a "mutual agreement to end the employment".

Here's another resource to check CA Precedent Decisions

Quit in Anticipation of discharge "or layoff"

Because of this, I would feel much better for you if that letter offers you the severance, so they can avoid formally laying you off.

Mar 24, 2010
Further details
by: Charles

Thanks for replying, and thank you for the link. I've read it and it would seem that this section would apply to my situation:

D. Quit in Lieu of Discharge

Title 22, Section 1256-1(d), provides:

An employee who leaves work when asked by the employer to either resign or be fired, or an employee who resigns rather than agree to a forced leave of absence, has not left work of his or her own free will. In these situations, since the employee did not choose to quit, the employer is the moving party in the separation and the employee becomes involuntarily unemployed.

This seems to be exactly where I am with my employer. I didn't mean to imply that there is anything else going on. They've simply given me a choice A) Resign, they'll pay one month of severance and provide good references to potential employee's who call, or B). Don't resign and you'll get nothing.

For some reason they seem very aversive to using the word "Layoff". Not sure why, could be a UK/US thing. I'm not calling them evil or anything, as I think part of this might be the difference in UK/US unemployment. I *think* in the UK you can resign with cause (ie: position is terminated) and receive benefits.

It sounds like to qualify for the above guidelines, they would have to explicitly tell me, "Either quit or be fired", preferably in an email as proof. Does that sound about right?

I did call the EDD the other day and the person said, for the most part, EDD views a resignation as a voluntary quit, regardless of whether the position was being terminated or not. This would seem to conflict with the above guideline.

Looks like a claim for benefits would most likely end up as a scenario where I would have to plead my case, citing the above, doesn't it?

Ideas? Thoughts?


Hi Charles,

Yes, I do have some thoughts. I believe the EDD is referring to the difference between a quit in lieu of discharge and a quit in anticipation of discharge .. the latter of which is generally disqualifying.

A quit in lieu of discharge is when the employer says if you don't quit by "this date" you will be discharged immediately.

Then the state actually needs to adjudicate it as a termination and decide whether there was actually misconduct involved .. which is what good cause is when someone is fired.

You need documentation from the employer which simply states that the agreement to end your employment is a "mutual agreement" .. did you read about that type of separation?

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