It often happens that an employee resigns from the workplace and thereafter refers a case to the CCMA alleging unfair dismissal. Many employers don’t realise that even though an employee has resigned voluntarily, this may amount to a dismissal. Such a dismissal is termed “Constructive dismissal”

Constructive dismissal can be defined as “a situation in the workplace, which has been formed exclusively by the employer, and which renders the continuation of the employment relationship intolerable for the employee – to such an extent that the employee has no other option available but to resign, with or without notice, or to simply leave the employment of the employer.”

In other words, the employee is forced to resign due to unfair pressure, unreasonable instructions or unbearable behaviour caused or created by the employer (thus, “constructive dismissal”).
Examples of intolerable conduct include abuse, assault, forced transfers, sexual harassment, demotion, and failure to pay a salary.

The Labour Relations Act (LRA) 66 of 1995 (as amended) gave statutory status to constructive dismissal. Section 186(1)(e) determine that “dismissal” means, among other things, that “an employee terminated a contract of employment with or without notice because the employer made continued employment intolerable for the employee.”

Therefore, constructive dismissal is subject to a number of requirements, which we will look at later. For now it is important to remember that if the above-mentioned statutory description applies, the Act deems the employer to have unfairly dismissed the employee, which amounts to unfair dismissal in terms of the LRA.

To convince an arbitrator or judge that unfair constructive dismissal has taken place the employee must show that:
• The employment circumstances were so intolerable that the employee could truly not continue to stay on.
• The unbearable circumstances were the cause of the resignation of the employee.
• There was no reasonable alternative at the time but for the employee to resign to escape the circumstances.
• The unbearable situation must have been caused by the employer.
• The employer must have been in control of the unbearable circumstances.

With conventional dismissal, it is up to the employer to prove that the dismissal was procedurally and substantively justified and fair. With constructive dismissal, however, the burden of proof rests on the employee, who must prove constructive dismissal on a balance of probabilities (In the case of Jooste v Transnet).

Once the employee has discharged the onus of proving that he/she was constructively dismissed, the onus shifts to the employer to prove that the employees action of resigning was unreasonable (in accordance with Section 192 of the LRA).

A resignation by the employee for purposes of avoiding the disciplinary hearing is unlikely to constitute constructive dismissal. For example, in the case of Mvamelo vs AMG Engineering (2003,11 BALR 1294) the employee was informed he was to face a disciplinary hearing for theft and that criminal charges would also be laid. He resigned and claimed constructive dismissal, but lost the case because it was found by the arbitrator that he had resigned to avoid the disciplinary steps of which he had been notified.

However, where disciplinary steps have been taken unfairly and this renders the employment circumstances intolerable, this can constitute constructive dismissal. For example, in the case of Solidarity obo Van Der Berg vs First Office Equipment (Pty) Ltd (2009, 4 BALR 406) the employee was found to have been performing his work poorly. The employer decided to stop paying him his salary and replaced it with a commission structure. The employee resigned and referred a dispute to the CCMA, where it was found that the employee had been a victim of constructive dismissal.

Employers should be advised not to make circumstances intolerable for an employee in an effort to force the employee to resign. Such actions could lead to unfair dismissal disputes and compensation which must be paid to the affected employee.

Article by:
Gerard Smit
CEO Cape Town – Dispute Resolution Official