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CONSTRUCTIVE DISMISSAL: When will a claim for “forced resignation” succeed?

An Overview on Constructive Dismissal & Forced Resignation in South Africa

Employment contracts usually terminate when the employer dismisses the employee – or when the employee resigns. There’re other situations such as the expiry of a fixed-term contract, completion of a specified task, retirement, death, or by mutual agreement.

But S186 (e) of the LRA adds a special category – “constructive dismissal”. This is the situation in which the employee is forced to resign, with or without notice – or simply abandons the job because the employer made continued employment intolerable.

The effect is that a resignation or abandonment can actually turn out to be a dismissal. If so, and if the employer can’t prove the dismissal was fair, he or she can claim reinstatement or compensation as in other types of unfair dismissal.

 

Related:

REINSTATE OR COMPENSATE? Will it be impractical to order reinstatement because an unfairly dismissed employee behaved badly in the arbitration? 

 

Constructive Dismissal Cases Involve a Two-Stage Test

  1. The employee must first prove there was a dismissal because the employer made the circumstances in the working relationship so intolerable that he or she was forced to leave. If this succeeds – the resignation is then classified as a “dismissal”.
  2. The onus then shifts to the employer to prove the dismissal was fair, just as it would have to do in other types of dismissal.

The key issues to determine are whether –

  • The employee brought the contact to an end;
  • The reason was that the employer made continued employment “intolerable”; and
  • The employee had no reasonable alternative other than terminating the contract.

 

The Labour Court

The Labour Court of South Africa has confirmed that the test for establishing constructive dismissal is:

“Whether the employer, without reasonable and proper cause, conducted itself in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between the employer and employee.

 

TIP:      The employer risks a successful claim for constructive dismissal if it deliberately or by default makes the working environment intolerable for the employee. If the employee proves the employer was responsible – the employer usually has a tough time proving the dismissal was fair.  The employee generally has an equally tough time proving the working conditions were intolerable and that the employer was responsible for it. The success rate of proving there was a dismissal is less than 30%.      

        

[1] Dismissal (Second Edition) John Grogan, Juta & Co, p 65

[2] Strategic Liquor Services v CCMA & others (CCT 33/09[2009] ZACC 17 in Worklaw: www.worklaw.co.za;

[3] Unfair Dismissal, Prof Alan Rycroft


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