Published on:

A Forced Resignation Is Not a Disqualification of New Jersey Unemployment Compensation Benefits

The New Jersey Appellate Division recently reversed a decision of the Appeal Tribunal and the Board of Review disqualifying a claimant from receiving unemployment compensation benefits when he was forced to resign from his job. The Court disagreed with the prior determination that such a forced resignation was a voluntary separation from employment and instead found that the statement “you must resign,” made to the claimant by his supervisor, was really no different than “you’re fired.” The Court found that the employer’s actions amounted to a compelled resignation, which would not constitute a voluntary separation from employment and disqualification from receiving New Jersey unemployment compensation.

In Talmage Lord v. Board of Review, New Jersey Department of Labor and Crossmark Inc., the claimant, Mr. Talmage Lord, was employed by Crossmark Inc. Mr. Lord’s job duties included reseting merchandise on Crossmark’s retail stores in New Jersey and Pennsylvania. Mr. Lord was required by his employer to use his own car to travel to each store and perform his work. On June 3, 2009, Mr. Lord’s car broke down on his way home and the car was towed to a garage. Mr. Lord immediately informed his supervisor and he was excused from coming to work the following day, Thursday, June 4, 2009. On Thursday, Mr. Lord was informed that his car’s transmission was broken and he could not afford the cost of the repair. After failed attempts to borrow the money or find alternative transportation, Mr. Lord called his supervisor on Friday to inform him of the situation. Mr. Lord’s supervisor told him he “had to resign” from his employment “effective immediately.”

In its decision to disqualify Mr. Lord from receiving New Jersey unemployment benefits, the Appeal Tribunal concluded that Mr. Lord left his job because he was unable to obtain transportation that was needed to perform his job. The Appeal Tribunal noted that in cases bordering between discharge and voluntarily leaving, the person who initiates the action, which eventually leads to the separation, is the one responsible for breaking the employment relationship. The Appeal Tribunal found that Mr. Lord’s personal car troubles and not the statement from his supervisor that “he must resign” was the reason for the ending of his employment. Based upon this interpretation of the facts, the Appeal Tribunal concluded Mr. Lord left work voluntarily without good cause attributable to his work and was therefore ineligible for unemployment compensation benefits.

In reversing the Board of Review and Appeal Tribunal’s decision, the Appellate Division cited, Campbell Soup Co. v. Board of Review, 13 N.J. 431, 435 (1953), which stated that a separation from employment will only be considered voluntary under N.J.S.A. 43:21 -5(a) if “the decision whether to go or to stay lay at the time with the worker alone.” The Appellate Division found that forcing Mr. Lord to resign made his separation from employment Crossmark’s decision, not his own. The Court prevented Crossmark from hiding behind a forced resignation and concluded that when the supervisor told Mr. Lord he “had to resign…effectively immediately” this was synonymous with a discharge or involuntary termination of his employment.