Types of Separation from Employment

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There are many ways to lose a job. Employment separation occurs when the employment contract or at-will agreement between an employee and his or her company comes to an end.

Some terminations will be forced by an employer, including getting fired or laid off. Other separations, like retirement or resignation, will be voluntary. A furlough is a temporary separation from a job.

Knowing which type of separation from employment you’ve experienced is important. It may determine whether you receive unemployment benefits and severance pay. It’s also essential to know the particulars so that you can prepare to interview for new jobs.


You don’t have to advertise the nature of the separation during your interview process, but you do need to be honest if it comes up.

Types of Termination and Other Employment Separations

Constructive Discharge: Constructive discharge, also known as constructive termination or constructive dismissal, occurs when an employee quits under duress and believes that they have no choice but to leave their employer.

Often, they feel that they have been forced to leave by an employer who has intentionally made their working conditions intolerable. If employees who are separated in this manner can prove their case, they may retain some of the same rights as a discharged worker.

Although it appears as if the employee left voluntarily, he or she had no other option but to leave due to the very difficult working conditions.


If the employer’s actions are illegal or unlawful, the employee may have a viable claim for wrongful dismissal.

Fired: A firing takes place when an employer severs ties with a worker due to poor performance or violations of company policy. Depending on the nature of employment, an employer may work with the employee in order to resolve the problematic situation or provide a probation plan as a warning. In the case of at-will employment, an employee can be fired without a reason or without warning.

Layoff: Being laid off refers to a separation in which the employer has let an employee go because their services are no longer needed. Layoffs occur when employers experience a reduced volume of business or funding, or when a reorganization occurs that renders a job unnecessary. Economic changes, financial decisions, restructuring, redundancy, attrition, or a change in function may lead to this kind of separation from employment. Layoffs can happen to one or many employees at once, depending on the circumstances.

Termination for Cause: When an employee is terminated for cause, they are fired from their job for a specific reason. Reasons can include any sort of misconduct, such as ethics violations, failure to follow company rules, breach of contract, theft, falsifying documents, violence, harassment or threatening behavior towards others, insubordination, etc.

Termination By Mutual Agreement: Termination by mutual agreement covers situations where both the employer and employee consent to a separation. Examples include contract employees at the end of their agreement, retirement, and forced resignation. Mutual agreement does not necessarily mean that both parties are happy with the arrangement. It just means that they have formally agreed to stipulations for a separation.

Termination With Prejudice: Termination with prejudice indicates that an employee has been fired due to inadequate performance, poor attitude, or ethical/legal transgressions. Employees terminated with prejudice are ineligible for rehire.

Termination Without Prejudice: A termination without prejudice means an employee has been let go for reasons other than performance, behavior, or attitude on the job, as in a layoff. Employees terminated without prejudice are eligible for rehire into the same or similar job role.

Involuntary Termination: An involuntary termination takes place when an employer either fires or lays off an employee.

Voluntary Termination: A voluntary termination occurs when an employee resigns or retires of their own will.

Wrongful Termination: Wrongful termination happens when an employee is discharged from employment for illegal reasons or if company policy is violated when the employee is fired. Discrimination, complaining about workplace issues, and being unwilling to commit an illegal act on behalf of the employee are other common examples.

Temporary Job or Employment Contract Ends: Once an employment contract is completed, or a temporary job ends, there will be a separation unless the employment is extended further.

Types of Resignation From a Job

Resignation: A resignation occurs when an employee decides to leave a job of their own accord. Submitting your resignation is an official notice that you are ending the relationship between yourself and the company. Resignation etiquette varies by organization and job type, but typically, written notice at least two weeks in advance of your official last day is commonplace.

Forced Resignation: A forced resignation means that an employer has offered an employee an ultimatum -- either resign or be fired. This sometimes falls under the “constructive dismissal” umbrella.

Types of Retirement

Retirement: Retirement is a separation from employment whereby an employee opts to cease working once they have met the age and tenure stipulations laid out by the employer or negotiated by the employer and a union.

Mandatory Retirement: Mandatory retirement rules are limited to a few occupations where workers are deemed a risk to the public or themselves as they experience diminished capacities after a specified age. Examples include air traffic controllers, law enforcement officers, and pilots.

Phased Retirement: Phased retirement occurs when older employees are allowed to steadily reduce their work hours over time, often months in advance of their official retirement date.


During a furlough, an employee is still considered employed. A furlough is considered a temporary unpaid leave from a job. If the worker is eligible for unemployment benefits, they may be able to collect.

In addition, many employers continue health insurance and other benefits for furloughed employees.

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