By Talita Laubscher and Monique Jefferson

In Western Cape Education Department v General Public Service Sectoral Bargaining Council and Others [2014] 10 BLLR 987 (LAC) the respondent employee, Mr Gordon, suffered from prolonged ill health after he suffered a heart attack. He accordingly applied for ill health retirement and temporary incapacity leave. His application form was handed to his senior manager, Mr Elliott, who undertook to attend to the application personally and to ensure that the form was signed by two witnesses. A few months later, Mr Gordon was informed by the employer, the department, that his application had not been processed as there had been a technical error in that it was not signed by two witnesses. He was informed by the department that he was required to report for duty, failing which he would be dismissed for abscondment. He was further informed by the department that his absence over the past two years would be regarded as unpaid leave and that in order for the department to recover the amount that had already been paid to him in respect of his salary during his period of absence, an amount of R 753 352,02, monthly instalments of R 12 000 each would be deducted from his salary. This was a deduction of roughly 80% of Mr Gordon’s monthly salary.

Mr Gordon then lodged a grievance and on receiving no response to the grievance, he resigned. A meeting was then convened between Mr Gordon and the department during which he was given the option to proceed with the resignation or to retract it and continue with his application for ill health retirement. He was also informed that the head of the department would be approached about the decision to regard his absence as leave without pay and the resultant deductions. Being under the impression that his grievance and concerns would be seriously considered by the head of department, Mr Gordon retracted his resignation. However, at the end of that month a further R 12 000 was deducted from his salary and he still heard nothing about the outcome of his grievance. Another grievance meeting was convened and when nothing further happened for another month, he resigned and referred a constructive dismissal dispute to the bargaining council.

The bargaining council found that the dismissal was unfair and ordered reinstatement. On review, the Labour Court per Steenkamp J, held that while it was unusual for an employee to seek reinstatement in a constructive dismissal claim, reinstatement was nevertheless an appropriate remedy in these circumstances.

The matter was then taken on appeal to the Labour Appeal Court (the LAC). The LAC was required to consider the following –

• whether Mr Gordon’s resignation constituted constructive dismissal;

• whether the department had made the employment relationship intolerable; and

• whether reinstatement was the appropriate remedy.

As regards Mr Gordon’s contention that he was constructively dismissed, the LAC (per Molemela AJA, Davis JA and Sutherland AJA) found that in determining whether or not an employer made continued employment intolerable, the employer’s conduct has to be considered as a whole.

Furthermore, the requirement is not that the employee must have no other choice but to resign but only that the employer made continued employment intolerable. In this case, the senior managers in the department had frustrated Mr Gordon’s application process for ill health retirement and had had no regard for the fact that he had been suffering from anxiety and post-traumatic stress disorder. The department had also reached a decision to treat his period of absence as unpaid and had insisted on making unreasonable deductions from his salary. In terms of s 38 of the Public Service Act 103 of 1994 an employer is permitted to recover amounts from employees where there has been an overpayment but these deductions must be reasonable. The LAC concluded that a deduction of 80% of an employee’s salary was not reasonable. Furthermore, the department did not seriously consider Mr Gordon’s grievance and had continued to make deductions from his salary despite his request that a moratorium be placed on the deductions pending the outcome of his temporary incapacity application. The LAC found that these deductions were significant and were sufficient to render Mr Gordon’s employment intolerable, especially in light of the department’s apathy in resolving his issues. This was further compounded by the fact that the department had been careless in ensuring that Mr Gordon’s application be processed. Had Mr Elliott procured the signature of two witnesses as he undertook to do, the application would have been processed and Mr Gordon would not have found himself in a situation where he had to repay the amounts that had been paid to him over a period of two years. Thus, the LAC held that Mr Gordon had discharged the onus of proving that his employment was rendered intolerable.

The LAC considered the fact that Mr Gordon was seeking reinstatement but found that this did not defeat his claim that he had been constructively dismissed. This was because he was seeking reinstatement more than two years after the termination of his employment and work environments change. Thus, the fact that Mr Gordon sought reinstatement did not mean that the circumstances had not been intolerable at the time that he resigned. In this regard, Mr Gordon argued that the work environment would be different if he were to be reinstated as he would not be subject to deductions or if he was required to repay the amount, the deductions would be reasonable. He also had reason to believe that the matter would be handled better as the department had implemented better procedures. Furthermore, Mr Gordon had recovered psychologically since his constructive dismissal.

The LAC held that while it is unusual to grant reinstatement in constructive dismissal cases, the courts are not precluded from doing so where the circumstances that gave rise to the constructive dismissal have changed. It was found that in this case there had been a change in circumstances and thus reinstatement was appropriate. The appeal 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 2015 (Jan/Feb) DR 62.