The Minnesota Court of Appeals ruled that an employee who voluntarily accepted a severance package to avoid potentially being laid off did not have a good reason to quit her employment and could not receive unemployment benefits. Ward v. Delta Airlines, A21-0932, (Minn. Ct. Apps. April 4, 2022).
In March 2020, Delta Airlines placed employee Teresa Ward on a paid leave of absence due to the Covid-19 pandemic. Ms. Ward had worked for Delta for 13 years in customer service. In June 2020, Delta offered its employees a voluntary severance package if they chose to leave the company. According to Ms. Ward, Delta had told employees they could voluntarily leave the company and get a severance package to prevent being possibly being laid off and receiving no severance. Delta told employees that if not enough people volunteered to leave and accept the severance package, there would be forced layoffs and those laid off employees would not receive a severance package. Ms. Ward did not know if she would have been one of those employees laid off. Not knowing if she would be out of a job with no money, Ms. Ward chose to voluntarily resign in order to receive the severance package.
Under Minnesota unemployment laws, an employee who quits their employment is generally not eligible for unemployment benefits. One exception is if there is a “good reason” caused by the employer. The Minnesota Court of Appeals determined that, Ms. Ward did not have a “good reason” for quitting her employment caused by Delta Airlines. As a result, Ms. Ward was not eligible to receive unemployment benefits.
Minnesota’s unemployment law statute contains a provision stating, “notification of discharge in the future, including a layoff because of lack of work, is not a good reason caused by the employer for quitting.” Minn. Stat. §268.095, subd. 3(e) (2020). Minnesota’s unemployment law statute also states, “An employee who has been notified that the employee will be discharged in the future, who chooses to end the employment while employment in any capacity is still available, has quit the employment.” Minn. Stat. § 268.095 subd. 2(c) (2020).
The Court found Ms. Ward’s situation was similar to one in which an employee quits after notification of a future discharge. In that case, the employee who quits before the employment end date set by the employer is not eligible for unemployment benefits.
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