Resignation (HR Glossary)
Resignation is the formal and voluntary act of an employee deciding to end their employment with an organization. It typically involves notifying the employer—usually through a written resignation letter—and serving the required notice period as defined in the employment contract or company policy.
In HR and workforce management, resignation marks the beginning of the employee offboarding process. It signals the transition from active employment to separation and triggers a series of administrative, payroll, and knowledge-transfer activities. Simply put, resignation occurs when the employee—not the employer—initiates the end of the employment relationship.
Resignation in HR and Employee Lifecycle
Within HR operations, resignation is a structured process rather than just a notification. Once an employee submits their resignation, HR and the reporting manager typically manage notice compliance, workload handover, exit formalities, and final settlement.
The standard resignation workflow includes:
- Formal Notice: Submission of a resignation letter or digital notification.
- Acceptance: Acknowledgement and formal acceptance by the employer.
- Notice Period: Serving the required time and facilitating knowledge transfer.
- Exit Interview: Gathering feedback to improve organizational culture.
- Full and Final Settlement: Processing final dues, leaves, and bonuses.
- Record Updates: Finalizing employee offboarding and updating the HRMS.
A well-managed resignation process helps ensure business continuity and maintains positive employer-employee relationships.
Common Reasons for Employee Resignation
Employees may resign for various professional or personal reasons, which often inform an organization's retention strategy:
- Career growth or better job opportunities elsewhere.
- Relocation or significant personal commitments.
- Compensation or role dissatisfaction.
- Work-life balance considerations.
- Pursuit of higher education or a complete career change.
Understanding these trends helps HR teams improve workforce planning and talent management.
Resignation vs. Termination: Key Differences
| Feature |
Resignation |
Termination |
| Initiator |
Initiated by the employee. |
Initiated by the employer. |
| Nature |
Voluntary separation. |
Involuntary separation. |
| Timeline |
Usually includes a predefined notice period. |
May be immediate or policy-driven. |
| Driver |
Often a career-driven or personal decision. |
Often performance, conduct, or business-driven. |
This distinction is critical for legal compliance, documentation, and the accuracy of employee records.
Importance of Managing Resignation Properly
Effective resignation management protects both organizational operations and the employee experience. Proper handling ensures:
- Knowledge Transfer: Preventing loss of critical business information.
- Payroll Accuracy: Ensuring a precise full and final settlement.
- Compliance: Adhering to labor policies and contract terms.
- Employer Brand: Preserving a positive reputation in the talent market.
- Strategic Feedback: Obtaining valuable insights through exit interviews.
Organizations that standardize resignation workflows typically experience fewer disputes and maintain better workforce continuity.
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