Difference between Resignation and Termination

Key difference: Resignation is when the employee decides to leave his job. It is the formal act of giving up or quitting one's office or position. A termination is when the employer fires the employee.

Having a job is one of the responsibilities of being an adult. For most adults, a job is the only source of income they have. However, at times it doesn’t work out and one either resigns from the job or is fired. So, let’s see what exactly the difference between resignation and termination is.

Resignation is when the employee decides to leave his job. It is the formal act of giving up or quitting one's office or position. However, if one is hired on a contract basis, for example, for one project, or for one year, and the employee leave at the end of the year of the end of the project, then this is not counted as resignation. However, if the employee leaves before his year is over, or before the project is completed, then he resigned his position at the company.

On the other hand, if the employee was asked to leave by the employer or is fired then it is said that the employee was terminated, or that his employment was terminated. Termination is also often known as being given the pink slip. There are two main types of termination: being fired and being laid off. Being fired is when the employee is asked to leave due to some fault of the employee. Hence, it is often considered in most cases to be dishonorable and a sign of failure. Being laid off, on the other hand, is when the employer has to let go of the employee due some economic reasons, like downsizing the company. This essentially means that they don’t want to get rid of the employee but they must.

From an employee’s point of view, it is better to resign rather than be fired, as being fired is often looked upon negatively. However, from an employer’s point of view, it is better from the employee to resign, rather than be terminated. This is mainly because if the employer fired the person, then they may have to have severance fees. Hence, in these cases, what the company does is to either ask the employee to resign, or to force them to resign.

Comparison between Resignation and Termination:

	Resignation	Termination
Definition	A resignation is the formal act of giving up or quitting one's office or position.	A termination is when the employer fires the employee.
Also known as	Quitting	Being fired or laid off. Pink Slip.
Initiated	Employee-initiated	Employer-initiated
Time period	Must provide notice period, often of two weeks or a month.	May be asked to leave immediately, at the end of the month, or after completing current work or project.
Compensation	Employer is usually not required to pay anything beyond the payment for the work done, as the employee chose to leave.	Employer may have to pay compensation or severance pay.