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Home RA Newsletters Constructive Dismissal Part 1

Constructive Dismissal - Part 1

 26th October 2009

Dear reader.

This week we will be discussing the very tricky issue of constructive dismissal.  Many employees have resigned in the heat of the moment, thinking they will refer an unfair dismissal dispute only to be disappointed when the dispute is dismissed because there wasn’t really a dismissal.  In this newsletter we will investigate:

  • What is constructive dismissal;
  • What tests do our courts apply (a summary, Part 2 will deal with different judgements extensively;
  • What you can do to ensure the successful referral of a constructive dismissal dispute.

What is constructive dismissal?

Section 186(1) (e) of the Labour Relations Act states that:

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

Constructive dismissal thus entails that the employer’s actions, which can take on many forms, drives the employee to leave the employer’s employment.  In CEPPAWU & Another v Aluminium 2000 CC [2002] 5 BLLR 399 (LAC) para 30 the Labour Appeal Court considered and defined the meaning of section 186(1) (e):

“Constructive dismissal involves a resignation because the work environment has become intolerable for the employee as a result of conduct on the part of the employer.”

What test do our courts apply?

According to the court there are three requirements for constructive dismissal:

  • The first is that the employee must have terminated the contract of employment.
  • The second is that the reason for termination of the contract must be that continued employment has become intolerable for the employee.
  • The third is that it must have been the employee’s employer who had made continued employment intolerable.

All three these requirements must be present to proof constructive dismissal.   The onus is on you, the employee, to prove all of the above.  If one of them is absent, constructive dismissal is not established. Thus, there is no constructive dismissal if an employee terminates the contract of employment without the two other requirements present. There is also no constructive dismissal if the employee terminates the contract of employment because he cannot stand working in a particular workplace or for a certain company and that is not due to any conduct on the part of the employer.

Only once it has been established that you were indeed constructively dismissed to onus will shift to the employer to prove that you were dismissed for a fair reason and in accordance with a fair procedure.

In the case of Executive Council for the Department of Health, Eastern Cape v Odendaal and Others (P504/07 ) [2009] ZALC 5 (13 January 2009) the Labour Court confirmed that law in respect  of constructive dismissal1 is as follows:

"In considering what conduct on the part of the employer constitutes constructive dismissal, it needs to be emphasized that a constructive dismissal' is merely one form of dismissal. Ina conventional dismissal, it is the employer who puts an end to the contract of employment by dismissing the employee. In a constructive dismissal it is the employee who terminates the employment relationship by resigning due to the conduct of the employer. As Lord Denning said in Woods v WM Car Services (Peterborough) Ltd (1982) IRLR 413 (CA) at 415: 'The circumstances [of constructive dismissal] are so infinitely various that there can be, and is, no rule of law saying that circumstances justify and what do not. It is a question of fact for the tribunal of fact...'

The question that stems from section 186(1) (e) is under which circumstance can it be said that the employer has made continued employment intolerable?   The Labour Appeal Court through different judgements2, have answered this question in the following way:

“When an employee resigns or terminates the contract as a result of constructive dismissal such employee is in fact indicating that the situation has become so unbearable that the employee cannot fulfil what is the employee’ s most important function, namely to work.  The employee is in fact saying that he or she would have carried on working indefinitely had the unbearable situation not been created.  She does so on the basis that she does not believe that the employer will ever reform or abandon the pattern of creating an unbearable working environment.  If she is wrong in this assumption and the employer proves that her fears were unfounded then she has not been constructively dismissed and her conduct proves that she has in fact resigned.


What you can do to ensure the successful referral of a constructive dismissal dispute?

As indicated above the first step will have to be to resign.  When writing your resignation letter you will have to state very clearly the reason for your resignation, viz the fact that the employer’s actions drove you to leave and that the employer’s conducted amounts to constructive dismissal.  It is advisable to seek proper advice and guidance in this regard.

But before you contemplate resigning take note of the following:

  • It has crystallized that you must take reasonable steps to resolve the problem that is leading to the unhappiness and frustration. 
  • It has been held before that an employee, who chooses to resign rather than seeking to resolve the problem informally, for example making use of the employer’s internal grievance procedures, was not constructively dismissed. 
  • Thus it will always be advisable to address your grievance with your employer through its internal grievance procedures.  In the absence of such procedures, it is advisable to place your grievance on record (in writing) and request your employer or HR department to address the grievance within a reasonable time.
  • If the grievance cannot be resolved and you still feel the need to resign and refer a constructive dismissal dispute, it will be investigated whether your resignation was a reasonable response to your employer’s conduct or actions.  Thus if there were other reasonable steps you could have taken, your claim for constructive dismissal will most likely be dismissed.

From the above it is clear that referring and succeeding with a constructive dismissal claim is not easy or guaranteed.  Contact us for expert advice should you contemplate resigning because your employer is making your employment intolerable.

Next week we will continue our discussion on constructive dismissal and also investigate different judgements were claims of constructive dismissal were either successful or dismissed.

Me. L Bouwer

General Manager: Legal Assistance

1 As set out in Jooste v Transnet LTt/a SA Airways

2 Pretoria Society for the Care of the Retarded v Loots (1997) 18 ILJ 981 (LAC), Jooste v Transnet t/a South Africa (1995) 16 ILJ 629(LAC)

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