Labour Law

Constructive Dismissal

By 29/08/2009 June 10th, 2012 No Comments

Section 186(e) of the Labour Relations Act 66 of 1995 defines dismissal in this context as occurring when:

“an employee terminated a contract of employment with or without notice because the employer made continued employment intolerable for the employee”.

Several cases have dealt with this subject of which three of the most notable are briefly discussed below.

In the case of Jooste v Transnet t/a SAA (1995) 16 ILJ 629 (LAC) it was held that the onus is on the employee to show that he in fact had no intention to terminate the contract of employment. This was extremely onerous for an applicant. However this case was decided before the present Labour Relations Act which specifically provides for constructive dismissal.

A more recent case,  Society for the care of the Retarded v Loots (1997) 18 ILJ 981 (LAC) held that the Court would look at the employers conduct as a whole but that it was not required that the employer had intended to repudiate the contract as is the case in English Law.

It was also held in SAPPI Kraft v Majake and others (1998) 19 ILJ 1240 (LC) that if it is shown that an employee was over sensitive, misinterpreted the employers conduct or resigned in order to escape disciplinary action, then a dismissal is not proved.

In light of the Loots and Majake cases it appears that the ordinary two stage approach in determining unfair dismissal claims can be used, however it will need to be modified slightly.

In the first stage, the applicant has to show that a dismissal took place. To achieve this, the three elements of Section 186(e) must be shown, ie

  • The contract was terminated (by the employee),
  • because of conduct on the part of the employer,
  • which made the continued relationship intolerable for him.

The first element is often common cause and may be evidenced by some form of letter of resignation.

In order to prove the second element, the applicant will have to present evidence of conduct on the part of the employer which was unreasonable or created a hostile environment. The conduct may take the form of acts or omissions and may be conduct on the part of the employer which is specifically intended to force the employees resignation.

The last element may present some difficulty as it is highly subjective. It will be necessary, in the light of the Loots case, to show that “reasonably and sensibly, the employee cannot be expected to put up with it”

It is also clear from Majake that an employee who is oversensitive will not be able to claim constructive dismissal.

In the second leg of an ordinary unfair dismissal case, the employer has to show that the dismissal was procedurally and substantively fair. While it is not really possible to separate the two elements of fairness in a constructive dismissal case, it remains clear that the onus at this stage is on the employer.

The Loots case referred to conduct on the part of the employer which is “without reasonable and proper cause”. It appears that this forms the basis of the second part of an inquiry ie that the employer must show that the dismissal was fair. If an employer will be able to show that his conduct was reasonable and proper (for example as part of a legitimate disciplinary process) a claim of constructive dismissal will be defeated. In this regard see Old Mutual Group Schemes v Dreyer & Another (1999) 20 ILJ 2030 (LAC).

This reinforces the view that an employee cannot simply resign to avoid the disciplinary process and then try and claim relief for constructive dismissal.

The test for constructive dismissal will be necessarily subjective and as such will not be easy to determine. One should be careful not to simply find that the employee was oversensitive and as such dismiss the case but on the other hand one should also guard against allowing employees who have genuinely resigned to be able to turn around and allege constructive dismissal when they regret their decision.

Ian Mc Laren

Ian Mc Laren

Ian McLaren BA LLB (WITS) General Educated St Johns College, Houghton. BA LLB University of the Witwatersrand 1984 Founded McLarens Attorneys September 1986. Right of Appearance High Court, October 1996. Expertise Litigation, Labour Law, Commercial Law, Family Law, Pension and Provident Funds, Customs and Excise, Wills, Deceased Estates, Trusts, Commercial Agreements, Reviewing and Drafting Government Legislation, Information Technology. Committees/ Trusts Law Society of South Africa Information Technology Committee. Trustee Verney College Educational Trust Other Transvaal Provincial colours for Practical Shooting. Third degree Black Belt JKS Karate. Photographer and motor cyclist Lectured for Continuing Legal Education on Information Technology issues.