Employees who choose to resign must follow certain legal and contractual obligations to ensure a smooth transition. Failure to do so can result in legal disputes, financial consequences, or reputational damage. 

In this article we’ll outline the legal obligations of employees when resigning, including notice periods, contractual requirements, final pay entitlements, employer expectations, and what to do if you want to resign immediately.

1. Understanding Your Right to Resign

Employees have the right to resign at any time, provided they give the required notice period as stated in their employment agreement.  

An employer cannot prevent an employee from resigning, but they can enforce contractual obligations such as notice periods or restrictions on working for competitors (if applicable). 

You are not legally required to provide a reason for your resignation unless your employment contract specifically asks for one. 

2. How much Notice must you Give?

A notice period is the amount of time you must continue working after you formally submit your resignation. The length of this period depends on your employment contract. 

• Most contracts require 2 to 4 weeks’ notice. 

• Senior roles or specialised positions may require longer notice (e.g., 6 weeks or more). 

• If your employment agreement does not specify a notice period, a reasonable period (often 1 to 2 weeks) is expected. 

Can Your Employer Waive the Notice Period? 

Yes. If you and your employer mutually agree, they may allow you to leave earlier than your contractual notice period. This can happen if: 

• The employer does not need a replacement immediately. 

• The company wants to save costs on wages. 

• You and your employer negotiate an earlier exit date. 

If your employer insists on enforcing the full notice period, you are legally required to work until the end of that period. 

3. How to Resign Properly

Step 1: Check Your Employment Agreement: Review your notice period and any special resignation conditions. Check if there are restraint of trade clauses (which may prevent you from joining a competitor). 

Step 2: Write a Formal Resignation Letter: This should be professional and include your intention to resign, the date of your last working day, and your signature and current date. 

Step 3: Submit Your Resignation in Writing: Deliver your resignation letter to your manager or HR, and keep a copy for your records. 

Step 4: Work Your Notice Period Professionally: Continue performing your duties responsibly, complete any handover if required, and assist in training a replacement (if applicable).

4. What Are You Entitled to When You Resign?

Upon resignation, you are legally entitled to: 

Final Pay: Your employer must pay all wages earned up until your last working day. If you were paid in arrears, you may receive wages after your last day (depending on the payroll cycle). 

Annual Leave Payout: If you have unused annual leave, your employer must pay it out with your final paycheck. 

Bonuses and Commission Payments: If your contract includes bonus or commission entitlements, you may still receive them if conditions were met before resignation. 

Reimbursement for Work Expenses: If you paid for work-related expenses, ensure you claim reimbursement before leaving. 

5. Can you Resign Without Working your Notice Period?

In most cases, resigning without notice can result in financial penalties or legal action. However, there are exceptions where immediate resignation is justified: 

• If your employer seriously breaches your employment agreement (e.g., unpaid wages, unsafe work conditions, or bullying). 

• If staying in the job causes immediate health or safety risks. 
• If both parties agree to waive the notice period. 

If you must resign immediately: 

• Explain your reasons clearly and professionally. 

• Offer to assist remotely if possible. 

• Keep documentation of any employment breaches (if applicable). 

6. Can your Employer Terminate your Employment During the Notice Period?

Yes, but only under certain conditions: 

Serious misconduct – If you engage in gross misconduct (e.g., fraud, harassment, or theft), your employer can dismiss you immediately.

Redundancy – If your role is made redundant during your notice period, your employer must follow redundancy procedures and provide any entitlements (e.g., redundancy pay if applicable) 

Conclusion 

Resigning requires fulfilling obligations and ensuring a smooth transition. By following proper procedures, respecting your notice period, and understanding your entitlements, you can leave your job professionally, while maintaining positive relationships with your employer. 

Handling your resignation correctly will help you transition smoothly into the next phase of your professional journey! 

Mahi Law can Help! 

Unsure of how to proceed? 

Our expert team will help you understand your employment rights, and pursue resolution (including compensation) through various channels, such as: Without prejudice negotiations, mediation, the Employment Relations Authority, or Employment Court if required. 

We also work on a no-win, no-fee basis – if we win your case, your employer covers the costs. 

Get in touch for a free consultation! You can fill out this form – or contact us at admin@mahilaw.nz, or 0800 450 032. 

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