Over the last 24 hours, there’s been a lot of drama as details start getting released over the departure of the Connecticut DOT Commissioner last week.  Did he really resign? Was he pushed out?

Late yesterday, Governor Rell released a new statement that suggested that she sought the resignation after allegations of inappropriate behavior were raised.  Several news outlets are reporting that the allegations were of harassment.  In short, it appears that he resigned when faced with a possible dismissal. (I should note that there have no formal charges of harassment against the employee, merely unspecified allegations at this point.)

Although the news outlets are trying to make much of this, from a legal perspective, these types of "resignations in lieu of dismissal" happen with some frequency by companies.  They are done so, for example, in cases were employers suspect something fishy is going on but can’t prove it to a certain degree.

In many cases, it is in both parties interests to use these types of "resignations". From an employee perspective, it allows them to "save face" and tell future employers that they resigned and were not fired.  For employers — although they will still have to pay unemployment compensation in many cases — having an employee leave "voluntarily" reduces the risk of a lawsuit arising from a dismissal.

In this case, it appears that the desire to avoid future litigation played some role in the negotiated departure. The CT Mirror has posted a copy of a signed "Stipulated Agreement" between the state and the DOT official which you can download here.  It suggests that any claims that the employee may have against the state are "extinguishe[d]" by the agreement.

Again, reviewing that agreement from a legal perspective, the most unusual part of is the non-disparagement provision.

Typically, the parties merely agree not to disparage one another. In this case, if the DOT employee is critical of the state, "such resignation in good standing shall be changed to a dismissal indicating that the services of [the employee] no longer pleased the Governor due to inappropriate behavior by [the employee]."

Resignations in lieu of dismissals, however, are tricky.  Some might interpret it as a coverup when it may be done for other reasons. Regardless, human resources personnel should consider consulting with counsel to ensure that the departures don’t create additional issues down the road.