Resignations: Not Necessarily the Deemed Holy Grail & Waiver of Liability for Employers

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The start of a new possible claim?

The relationship between an employer and employee may often become strained to the extent that a resignation by an employee is considered a relief to an employer. Although best practice would dictate that mediation and consultation be utilized to resolve internal disputes, this may not always be a feasible option. In instances where an employment relationship is riddled with animosity, disagreement, or a general sentiment of mistrust, it is easy to see why an employer would consider a resignation in such circumstances to be a “waiver of liability” in a certain sense.

The general misconception would be that the employment relationship is ended by the employee and that the employer can therefore be absolved of liability at a later stage by a court or other forum. This notion is however incorrect as an employee can still claim for constructive dismissal, or claim that the resignation should not stand as it was done in the “heat of the moment” .

What constitutes Constructive Dismissal?

The concept of constructive dismissal is defined in the Labour Relations Act as when an employee terminates a contract of employment, with or without notice, because the employer made continued employment intolerable for the employee. The test of constructive dismissal was considered in the Loots matter which indicated that when an employee resigns or terminates the contract because of constructive dismissal, such employee is indicating that the situation has become so unbearable that the employee cannot fulfil his most important function, namely, to work.

The employee is in effect saying that he or she would have carried on working indefinitely had the unbearable situation not been created. The employee does so on the basis that he or she does not believe that the employer will ever reform or abandon the pattern of creating an unbearable work environment. If the employee is wrong in this assumption and the employer proves that the fears were unfounded, then the employee has not been constructively dismissed and the conduct proves that said employee has in fact resigned.

John Grogan (CWIU obo Marele and Glass Centre obo Rudy (1999) 8 CCMA 6.13.15.) went even further to provide a more practical approach when it comes to constructive dismissals by testing the alleged dismissal by begging the following questions:

  1. Did the employee intend to bring an end to the employment relationship?

  2. Had the working relationship become so unbearable, objectively speaking, that the employee could not fulfil the obligation to work?

  3. Did the employer create the intolerable situation?

  4. Was the unbearable situation likely to endure for a period that justified termination of the relationship by the employee?

  5. Was the termination of the employment contract the only reasonable option open to the employee in the circumstances?

This test was likewise considered in Solid Doors (Solid Doors (Pty) Ltd v Commissioner Theron and Others (2004) 25 ILJ 2337 (LAC)), though it was narrowed down to three main considerations:

“…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 these three requirements must be present for it to be said that a constructive dismissal has been established. 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”

It becomes apparent that the onus would be on the employee to prove that the working relationship was not only intolerable, but that it was intolerable due to the actions of the employer. Additionally, that termination was the only remedy left to the employee, without which the intolerable relationship would continue which in turn would cause the employee to be unable to fulfil his duties. It is however important to note that this concept does not do away with the general rights of an employer to discipline employees out of fear of resignations and subsequent claims of constructive dismissal. If it is done, for instance, by an employee with the sole purpose of avoiding disciplinary action, it may be considered that the resignation did not sprout from an intolerable relationship, but that it was a means to avoid accountability (Mvamelo vs AMG Engineering (2003,11 BALR 1294)).

The pitfalls of a constructive dismissal can however be avoided by putting grievance procedures in place within the workplace. This will safeguard the employer by providing a platform for employees to raise concerns when they arise. It may additionally provide a defence to the employer that the employee did not utilise all the remedies available by failing to follow internal grievance procedures before resorting to resignation. This is however not set in stone as grievance procedures in this regard must not merely be a redundant platform where concerns and queries go to die, but rather a platform to address any workplace concerns by employees. It may further provide a platform for employers to mitigate animosity and discontent.

Heat of the Moment Resignations

Whilst it happens often that employees resign in the heat of the moment after a workplace dispute or junctures of discontent, it is of essential to establish the intent of the employee in submission of a resignation. Albeit Zondo J (Toyota SA Motors (Pty) Ltd v CCMA and Others (2007) ZACC 23.) considers resignation to be final, the intent must be scrutinized. This sentiment is reflected in CEPPWAWU and another v Glass and Aluminium ((2002) 5 BLLR 399 (LAC).) where a resignation submitted by an employee in the heat of the moment, and where attempts were made to withdraw the resignation shortly thereafter, was invalid. This sentiment was further reflected in Chemical Energy Paper and Printing Wood and Allied Workers Union v Glass and Aluminium 2000 CC (2002 ILJ 695 (LAC)) where it was indicated that a heat of the moment resignation was ineffective. Freedland elaborates on the sentiment of scrutiny by indicating that one must establish whether, on the one hand, the actions of the employee sprouted from pressures from the employer, and on the other hand, whether the employer was overeager to treat an impulsive or hesitant decision as final. (Freedland The Personal Employment Contract 420.) The pitfalls of resignations to this effect can also be avoided by yet again establishing grievance procedures in the workplace. In addition, a combination of thorough exit interviews with a clear and unequivocal resignation letter may go a long way for employers to avoid liability. (In re Amazwi Power Products (Pty) Ltd Shelly Turnbull 2008 29 ILJ 2552 (LAC) it was indicated that a resignation notice must be clear, unambiguous, and equivocal.)

Employers should therefore exercise caution in respect of resignations and consider the possibility of constructive dismissal as well as the true intent of each employee when faced with resignation.

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