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Demissão vs. renúncia

In Portuguese, translating resignation depends on the status of the position held. While demissão is the standard term for employees ending a contract, renúncia is reserved for high-level officials or holders of specific mandates giving up their power.

Demissão

B1
This is the general term for the termination of an employment contract. To specifically mean resignation (voluntary), it is almost always paired with the verb pedir (to ask), forming pedir demissão. If used alone or with other verbs, demissão can imply getting fired.
Ela pediu demissão porque encontrou um emprego melhor.
(She resigned because she found a better job.)
O funcionário entregou sua carta de demissão ao chefe.
(The employee handed his resignation letter to the boss.)
Ninguém esperava o pedido de demissão do gerente.
(No one offered expected the manager's resignation.)

Renúncia

B2
This word describes the formal act of relinquishing a title, rights, or a position of authority. It is used for politicians (presidents, senators), board members, Popes, or high-ranking executives stepping down from a term or mandate.
A renúncia do presidente chocou o país inteiro.
(The president's resignation shocked the whole country.)
Ele anunciou sua renúncia ao cargo de diretor do conselho.
(He announced his resignation from the position of board director.)
O papa Bento XVI surpreendeu o mundo com sua renúncia.
(Pope Benedict XVI surprised the world with his resignation.)

Summary

Use demissão (specifically pedir demissão) for regular jobs and employment contracts in the private sector. Use renúncia when a public official, politician, or high-level executive formally gives up a title or a seat of power.