My Employer Is Calling It a Voluntary Resignation. It Wasn't.

You were told your employment was ending. Maybe they said your position was being eliminated. Maybe they said it "wasn't working out." But now the severance agreement calls it a "voluntary resignation" or a "mutual separation." That language wasn't accidental. Your employer chose it deliberately, and it matters.

Why They Want It Labeled a Resignation

Unemployment. Employees who voluntarily quit generally have a harder time qualifying for unemployment benefits. By calling your departure a resignation, your employer may be positioning themselves to contest your unemployment claim.

Legal exposure. You can't bring a wrongful termination claim if you weren't terminated. By framing the departure as voluntary, the company creates an argument that no termination occurred, which could undermine discrimination, retaliation, and other claims.

Internal optics. A resignation looks better than a firing, both for the company's internal narrative and for any future legal proceedings. "She resigned" sounds very different from "we fired her."

When It's Not Really a Resignation

A resignation means you chose to leave. If any of the following are true, what happened to you was not a voluntary resignation:

You were told your position was being eliminated. You were told you should start looking for another job. You were given the choice between resigning and being fired. You were told your employment was ending effective a specific date. Your responsibilities were stripped and you were made miserable until you left (constructive termination).

California courts, including here in Los Angeles, look at the reality of what happened, not the label the employer puts on it. If you had no meaningful choice but to leave, that's a termination, regardless of what the paperwork says.

Constructive Termination

California recognizes "constructive termination" (sometimes called constructive discharge). This occurs when an employer deliberately makes working conditions so intolerable that a reasonable person would feel compelled to resign. Examples include:

Demoting you without cause. Significantly cutting your pay or hours. Reassigning you to a humiliating or impossible role. Creating or tolerating a hostile work environment. Retaliating against you until you quit.

If you were constructively terminated, you have the same legal rights as if you were fired outright, including the right to bring wrongful termination claims.

The Severance Agreement Problem

If the severance agreement describes your departure as a resignation, signing it could hurt you in multiple ways:

Unemployment. The EDD will see an agreement signed by you that says you resigned. For Los Angeles employees, this is a common tactic we see. Your employer can point to your own signature when contesting your claim.

Future legal claims. If you later try to bring a wrongful termination case, the employer will argue that you can't claim wrongful termination because you admitted in writing that you resigned.

The narrative. Future employers will ask why you left. If the official record says you resigned, it may limit your ability to explain what actually happened, especially if the agreement also includes a confidentiality or non-disparagement clause.

What to Negotiate

Accurate departure language. Push for the agreement to describe the separation accurately: "involuntary termination," "position elimination," or "reduction in force." At minimum, use neutral language like "separation" rather than "resignation."

Non-contest of unemployment. Negotiate a provision where the employer agrees not to contest your unemployment claim. This protects you regardless of what the agreement calls the departure.

Remove "voluntary" language. If the agreement includes phrases like "Employee voluntarily agrees" or "Employee acknowledges that this is a voluntary separation," push to remove or modify them. These phrases can be used against you.

What If You've Already Signed?

If you already signed an agreement that mischaracterizes your departure, the situation is harder but not hopeless. The EDD and courts can look beyond the paperwork to the reality of what happened. If the facts clearly show you were forced out, the resignation label may not hold up.

However, fighting this uphill battle is much harder than getting the language right in the first place. If you haven't signed yet, now is the time to fix it.

Don't Sign a False Narrative

Your departure story matters. For unemployment, for your legal rights, and for your career. Don't sign a document that describes what happened to you inaccurately.

Contact our employment team for a free consultation. We represent employees throughout Los Angeles and can review the language in your severance agreement, correct the departure characterization, and make sure you're not signing away leverage you didn't know you had.