Employment law update – The interplay between constructive dismissal and reinstatement

November 1st, 2013

By Talita Laubscher and Monique Jefferson

In Western Cape Education Department v General Public Service Sectoral Bargaining Council and Others [2013] 8 BLLR 834 (LC) Steenkamp J was required to consider whether an order for reinstatement is competent in a situation where the basis of the employee’s claim is that the employer made continued employment intolerable. It also raised the question as to whether seeking reinstatement would defeat a claim for constructive dismissal, since it would not appear to make sense for an employee to allege that he had no other option but to resign but, at the same time, to seek to be reinstated to such an unbearable environment.

The employee in this case, Gordon, had worked for the department for 23 years and suffered a heart attack followed by post-traumatic stress disorder and clinical depression. He was placed on sick leave and applied for ill-health retirement. Gordon submitted medical certificates between June 2007 and September 2008. On 3 December 2008 the department sent a letter to Gordon informing him that his medical certificates did not cover his absence after September 2008 and that the period from October 2008 to December 2008 would be regarded as unauthorised absence and he was ordered to report for duty immediately. He did not report for duty but submitted medical certificates to cover the period from October 2008 to December 2008.

Gordon had also applied for temporary incapacity leave in 2007 and submitted the requisite documents to the department’s human resources director. The documents were required to be signed by witnesses and the human resources director undertook to have the documents signed by two witnesses. In May 2009 Gordon was informed that his application for temporary incapacity leave had not been considered as there was a technical error because it had not been signed by two witnesses. He was required to re-submit the form and did so in August 2009.

The department informed Gordon that, because he had not re-submitted the form timeously, it would institute ‘leave without pay’ for the period from 31 July 2006 to 6 February 2009 when he was absent and the department would recover R 12 000 per month from his salary in order to recover an amount of R 753 352,02 that had been paid to him in his absence. This would leave him with an income of approximately R 2 159 per month.

Gordon then requested that the department place a moratorium on the deductions pending his application for temporary incapacity leave. He did not receive a response and consequently tendered his resignation and filed a grievance. During the grievance hearing he was given the option of proceeding with his resignation or retracting his resignation to be assisted by the department in an application for ill-health retirement. The department also undertook to reconsider the issue of his absence being regarded as unpaid leave and, in that regard, to revert the amount of the deductions, if any, to be made from his salary.

Gordon chose to withdraw his resignation but the department was not proactive in taking a decision regarding the repayment of the R 12 000 that had been deducted from his salary. There was another grievance meeting on 1 September 2009 but by the end of September there was still no decision regarding the deductions. Gordon submitted his resignation at the end of September 2009 and referred a constructive dismissal dispute to the bargaining council. The arbitrator found that Gordon had been constructively dismissed, that the dismissal was unfair and that he should be reinstated.

The department took the decision on review. The Labour Court held that the appropriate test on review in constructive dismissal cases is whether the commissioner correctly found that the employee was dismissed. Only if this is answered in the affirmative should the court apply the test set out in Sidumo and Another v Rustenburg Platinum Mines Ltd and Others [2007] 12 BLLR 1097 (CC) to determine whether the remedy granted is one that a reasonable commissioner could make. The arbitrator had found that the employee had been constructively dismissed as the employee was placed in circumstances that were objectively intolerable.

Furthermore, the arbitrator was of the view that the intolerable situation was of the department’s own making as the department could have taken steps to resolve the issue of the application for temporary incapacity leave quicker. In addition, the deductions made by the department from Gordon’s monthly salary were excessive. It was accordingly found that the department’s conduct was likely to damage the trust relationship.

By taking these factors into account, Steenkamp J found that Gordon’s resignation did amount to constructive dismissal. This was further supported by the fact that Gordon resigned only as a matter of last resort after he had raised the pertinent issues with the department and had given the department the opportunity to rectify the situation but, instead, Gordon was met with passivity and inaction by the department.

Steenkamp J found that it was unusual to claim reinstatement where the employee alleges that the working relationship was intolerable. Furthermore s 193(2)(b) of the Labour Relations Act 66 of 1995 requires an arbitrator to reinstate an employee unless the circumstances surrounding the dismissal are such that a continued employment relationship would be intolerable. However, after considering the evidence that was placed before the arbitrator Steenkamp J agreed with the arbitrator’s decision to reinstate Gordon. This was because it appeared that Gordon would not be subjected to the same circumstances that prevailed before he resigned as he would not be subject to the excessive deductions and he had furthermore recovered psychologically.

Thus, it was held that, while the employment circumstances had been intolerable at the time of his resignation in 2009, they were no longer intolerable at the time that he sought reinstatement in 2012. Steenkamp J agreed with the arbitrator’s finding and it was held that seeking reinstatement two and a half years later did not defeat Gordon’s claim for constructive dismissal. Thus, the arbitrator’s conclusion was not so unreasonable that no reasonable arbitrator could have come to the same conclusion and the review application by the department was accordingly dismissed.

Talita Laubscher BIur LLB (UFS) LLM (Emory University USA) is an attorney at Bowman Gilfillan in Johannesburg.

Monique Jefferson BA (Wits) LLB (Rhodes) is an attorney at Bowman Gilfillan in Johannesburg.

This article was first published in De Rebus in 2013 (Nov) DR 58.

De Rebus