CandleFocus Glossary Editor
Voluntary termination occurs when employees decide to end their employment contract with their employers, instead of the employers making that decision. Unlike situations in which a person may be let go from their job involuntarily due to corporate restructuring or other reasons, the decision to end a contract voluntarily is the employee's choice. Employees may choose to end employment for a variety of reasons, such as seeking new opportunities, switching career paths, involuntary relocation connected with a spouse's job, or to take an extended break from the workforce.
In some cases, an employer may offer a voluntary termination package in lieu of a layoff, which replaces a weaker exit package offered to employees who are laid off or fired with a more generous, voluntary basis. These packages typically include perks such as a lump sum, health insurance, and other benefits that can help smooth the transition. Such packages may also include an agreement between the employee and the employer to keep the resignation voluntary and avoid potential legal claims.
Voluntary termination may also refer to cancelling a contract with an outside vendor or service provider, like an Internet provider. In such cases, the end of the contract is usually welcomed by the vendor, as it does not reflect poorly on the vendor. Termination fees might still be charged to the customer, but it will usually be lower if the end of the contract is voluntary.
In any situation in which an employee-employer contract is ended early (or at the end of a fixed term), voluntary termination is usually the preferred outcome. It allows both the employer and the employee to transition more smoothly to the next stage, since both have mutually agreed on the end date in advance. Voluntary termination also helps to preserve a positive relationship between the two parties, in case they decide to work together again at a later date or pursue a referral or reference. Knowing how to handle a voluntary termination in a positive way can go a long way in helping both employees and employers transition more easily, while also keeping their professional relationships intact.
In some cases, an employer may offer a voluntary termination package in lieu of a layoff, which replaces a weaker exit package offered to employees who are laid off or fired with a more generous, voluntary basis. These packages typically include perks such as a lump sum, health insurance, and other benefits that can help smooth the transition. Such packages may also include an agreement between the employee and the employer to keep the resignation voluntary and avoid potential legal claims.
Voluntary termination may also refer to cancelling a contract with an outside vendor or service provider, like an Internet provider. In such cases, the end of the contract is usually welcomed by the vendor, as it does not reflect poorly on the vendor. Termination fees might still be charged to the customer, but it will usually be lower if the end of the contract is voluntary.
In any situation in which an employee-employer contract is ended early (or at the end of a fixed term), voluntary termination is usually the preferred outcome. It allows both the employer and the employee to transition more smoothly to the next stage, since both have mutually agreed on the end date in advance. Voluntary termination also helps to preserve a positive relationship between the two parties, in case they decide to work together again at a later date or pursue a referral or reference. Knowing how to handle a voluntary termination in a positive way can go a long way in helping both employees and employers transition more easily, while also keeping their professional relationships intact.