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Under Pressure

If an employee feels forced to quit, it could be trouble. Here's how to avoid a "constructive discharge" lawsuit.

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This story appears in the August 2004 issue of Entrepreneur. Subscribe »

When is a resignation not a resignation? When a court declares it a "constructive discharge."

Suppose you have an employee you want to get rid of for a variety of reasons, but you're worried that firing her might look like race or age or gender discrimination. So you try to force her out. You reassign her to a windowless office half the size of what she had. You assign her the least desirable work. You tell other employees to shun her. And after a few weeks, she quits. Then-surprise! You get slapped with the lawsuit you feared, claiming she was effectively terminated. What's up with that?

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