RSM South Africa

Proceeding with disciplinary measures following an immediate resignation

We are often requested by our clients to provide advice in situations where an employee resigns with immediate effect to avoid any sanction in the instance that the employer has convened, or intends to convene, a disciplinary hearing to determine whether a misconduct has been committed by an employee, and if successful in proving misconduct, to determine an appropriate sanction therefor.

In these circumstances, may the employer hold the employee to the contractually agreed notice period, and proceed with the disciplinary hearing during such notice period?

Our courts have recently rendered contradictory judgments regarding whether employers may proceed with disciplinary hearings after an employee has resigned with immediate effect. In the matter of Coetzee v Zeitz MOCCA Foundation Trust and Others (2018) 39 ILJ 2529 (LC), the Labour Court held that an employer may proceed with a disciplinary hearing even where the employee has resigned with immediate effect as a resignation with immediate effect is only permissible where there is a preceding material breach of contract by the employer or where the employer accepts the resignation with immediate effect. In essence, this judgment takes the position that an employee’s contract of employment only comes to an end in such circumstances through resignation and at the end of the contractual notice period.

We are however not convinced that the position adopted by Coetzee is entirely correct particularly in light of trite case law which holds that a resignation is a unilateral termination of the contract of employment which is not subject to the acceptance or approval of the employer. Additionally, the Constitutional Court has held, in the matter of Toyota SA Motors (Pty) Ltd v CCMA and Others (2016) 37 ILJ 313 (CC), that, “[w]here an employee resigns from the employ of his employer and does so voluntarily, the employer may not discipline that employee after the resignation has taken effect. That is because, once the resignation has taken effect, the employee is no longer an employee of that employer and that employer does not have jurisdiction over the employee anymore.

This approach has been adopted by the Labour Court in Mtati v KPMG Services (Pty) Ltd (2017) 38 ILJ 1362 (LC) and Naidoo and Another v Standard Bank SA Ltd and SBG Securities (Pty) Ltd (Case No: J1177/190 [Delivered 24 May 2019].

In the Mtati matter, the employer proceeded with a disciplinary hearing in the absence of the employee after she had resigned with immediate effect, finding her guilty and subsequently dismissing her. Due to this, the employee approached the Labour Court on an urgent basis and asserted that the employer could not discipline her as she had resigned and that the chairperson’s decision was therefore, null and void. The Labour Court agreed with the employee and ruled that the dismissal of an employee after his or her immediate resignation, albeit held in the period in which notice should have been served, was null and void because the employer no longer had the jurisdiction to dismiss the former employee.

In the Naidoo matter, the employee similarly challenged the employer’s jurisdiction to continue with a disciplinary hearing relating to charges of gross misconduct and dishonesty, post his resignation with immediate effect. The Labour Court held that in such circumstances the employer has no power to discipline an employee subsequent to his or her resignation with immediate effect. However the Labour Court did note that where an employee resigns without giving notice, the employee is in breach of the contract of employment. In such an instance, an employer may hold the employee to the contract of the employment by seeking an order for specific performance to serve the contractual notice period, however there is no legal basis for an approach whereby an employer may proceed with a disciplinary hearing without first approaching a competent court for an order for specific performance.

The position on whether an employer may continue to discipline an employee post resignation with immediate effect appears at first glance to be confusing but, if the latest case law as discussed above is followed, it is clear that the position is that an employer may not discipline employees following a summary resignation without first approaching a competent court for an order for specific performance to serve the contractual notice period, which may be costly and ultimately impractical.

Marc Humprhies

Regional Director | Legal, Johannesburg

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