During the last few years, employers may have been confronted with a situation where an employee would tender their resignation. A few weeks thereafter, the employer would be surprised to receive a referral to the CCMA, where this employee now claims constructive dismissal as a result of intolerable treatment by their employer.

Constructive dismissal relates to a scenario where the employer causes the working environment for an employee to become “intolerable”, ultimately resulting in the resignation of the employee.

In the recent Labour Court decision in Gold One Limited v Madalani and Others (2020), the court was asked to determine “intolerability”. The court held that “intolerability is a high threshold, for more than just a difficult, stressful or unpleasant working environment or employment conditions”.

In this case, the employee was employed by Gold One on 1 January 2012 and held the position of Contract Manager until such a time that she was relocated to another province, for which she had received a reasonable relocation allowance. Shortly after the employee had commenced duties in her new working environment, her direct supervisor noted that she would normally leave the premises during lunch times and that she had made herself guilty of poor timekeeping offences for which she had received a verbal warning. Her supervisor later requested the employee to participate in formal counselling sessions, which the employee took offence to and regarded as an attempt to make her working environment intolerable. The employee then failed to report for duty and referred a constructive dismissal dispute to the CCMA.

The Labour Court explored several key legal principles relating to constructive dismissal. Inter alia, the court reaffirmed the three requirements for constructive dismissal to be established –

  • The first is that the employee must have resigned.
  • The resignation must be as a result of the fact that a continued employment relationship had become intolerable for the employee.
  • Lastly, that the employer was to blame for the intolerable working environment.

Should one of these requirements not be complied with, the situation could not be considered to be a constructive dismissal. The courts have, for many years, applied an objective approach to the concept of intolerability, and evidence must show that under the circumstances, the employee had no other option but to terminate the employment relationship.

In general, a constructive dismissal claim may not be successful where an employee had the option of following grievance procedures before resigning or communicating grievances to the employer prior to resigning. However, failure to do so prior to the resignation will not mean that the employee cannot refer this type of dispute. Each case is evaluated on its individual merits.

In the case at hand, the court emphasised that it is well accepted that intolerability is considered in terms of a high threshold, far more than an unpleasant working environment or an uncompromising supervisor overseeing an employee. The employee in the One Gold-Matter failed to show that the employer had unreasonable disciplinary processes. The employee has suitable alternative remedies at her disposal, which could have been utilised as a platform for addressing complaints.

Hopefully, this established and confirmed legal position would serve as a deterrent for employees to resign the minute things do not go according to their wishes in the workplace and then approaching the CCMA seeking recourse.

Employers should, in response to this new case law, ensure that proper grievance procedures are in place and communicated to employees so that there is always a way of resolving disputes internally in an attempt to avoid having disputes referred to the CCMA.


Article by: Janeske Greef

Dispute Resolution Official – Cape Town