Employers are often faced with difficult situations when it comes to an employee being caught committing various acts of misconduct at the workplace. Certain acts of misconduct that are against the disciplinary code at a workplace are also in-fact against the laws of South Africa. Committing such an act of misconduct is not only an offence in terms of the disciplinary code, but also an offence for which an employee may be held criminally liable in terms of South African Criminal Law.
Section 34 of the Prevention and Combating of Corrupt Activities Act, 2004 (Act 12 of 2004) places the duty on an employer to report certain offences. Failure by an employer to report these offences can result in an employer being held criminally liable. Once an employer becomes aware, or ought to have been reasonably aware of an employee having committed an act of misconduct (that is not only against the disciplinary code of the workplace but also in contravention of the laws of South Africa), such an employer may have a duty and/or obligation to report it, as it amounts to a criminal offence. If reported to the South African Police Services, the employee may then be subjected to criminal charges.
But what kinds of offences does an employer have the duty and/or obligation to report to the South African Police Services?
Common law offences, under Section 34 of the Prevention and Combating of Corrupt Activities Act, which involve an amount over R100 000.00, such as:
- Theft, which is the unlawful appropriation of moveable corporeal property belonging to another with intent to deprive the owner permanently of the property;
- Fraud, which is the unlawful and intentional making of a misrepresentation which causes actual prejudice, or which is potentially prejudicial to another;
- Extortion, which consists of taking some patrimonial or non-patrimonial advantage from another, by intentionally and unlawfully subjecting that person to pressure which induces him or her to submit to the taking;
- Forgery, which consists of unlawfully and intentionally making a false document to the actual or potential prejudice of another;
- Uttering of a forged document, which consists of unlawfully and intentionally passing off a false document (forged) to the actual or potential prejudice of another.
Statutory offences, as defined under Chapter 2 of the Prevention and Combating of Corrupt Activities Act, which an employer also has a duty and/or obligation to report, such as:
- Corruption, which involves any person who gives or accepts, or offers to give or accept, any gratification amounting to an unauthorised or improper inducement to act or not to act in a particular manner, is guilty of an offence.
It is interesting to note that an employer does not always have a duty and/or obligation to report an employee for a criminal offence that has been committed. An employer may choose to do so at his discretion when requesting an employee to resign instead. However, according to section 34(1) of the Prevention and Combating of Corrupt Activities Act, any person who holds a position of authority (such as an employer), and whom knows, or ought reasonably to have known or suspected that any other person has committed an offence of corruption; or theft, fraud, extortion, forgery or uttering of a forged document, involving an amount of R100 000,00 or more, MUST report such knowledge or suspicion or cause such knowledge or suspicion to be reported to any police official.
Often, employees do resign to avoid disciplinary and/or criminal action in the face of serious allegations of misconduct. In such instances, an employer may elect to pursue a criminal case against the employee – but is it fair to request an employee to resign in these circumstances, or should an employer rather subject such an employee to a disciplinary hearing instead?
Once an employer becomes aware of an employee’s misconduct, where such misconduct is also a criminal offence, it is acceptable and fair for an employer to have the difficult and frank conversation with such employee – giving the employee the option to rather voluntarily resign instead of subjecting them to pending disciplinary and criminal action.
It is also important to note that the disciplinary process and criminal process are separate from one another and can take place simultaneously. Although the findings of either process may be used during the other to strengthen the employer’s case – such findings will only be considered as evidence where the finding alone will only be a factor to be considered in the merits of the case. This alone will not be conclusive enough for the finding to be consistent in both processes, as each process has a different onus and burden of proof. In a disciplinary hearing, the employee or accused must be found guilty on a balance of probabilities, whereas in the criminal court, the employee or accused must be found guilty beyond a reasonable doubt.
To answer the question of whether it is fair for an employer to request an employee to resign instead of facing criminal charges, the following case law may serve as precedent – Nokeng TSA Taemane Local Municipality // Louw No and Others (JA7/16)  ZALAC 37;  1 BLLR 35 (LAC) (17 October 2018), of which the facts may be summarised as follows:
An employee was suspended for alleged financial misconduct. The employee’s legal representative indicated that the employee would resign with payment of two to three months compensation. The employer refused such payment and stated that if the employee did not resign that they would also pursue criminal charges against him.
The employee contended that this amounted to a basis for constructive dismissal, and the employee did also not attend the disciplinary hearing. The employee proceeded to file an unfair dismissal claim and contended that the employer had threatened them with criminal action and rendered the employment relationship intolerable. The commissioner dismissed the employee’s claim.
The employee then took the matter on review, where the Labour Court held that the threat had the effect of coercing the employee into resigning. The Labour Court reviewed and set aside the arbitration award and ordered three months of compensation to be paid to the employee.
The employer subsequently took the matter on appeal to the Labour Appeal Court, where the employer argued that the employee had voluntarily resigned, despite possibly facing criminal charges. The Labour Appeal Court found that the threat of civil and/or criminal proceedings in relation to financial misconduct cannot reasonably constitute a threat rendering continued employment intolerable. The Labour Appeal Court also held that the employer was entitled to reserve the right to pursue criminal charges. The appeal was, therefore successful in favour of the employer.
In conclusion, an employer may request an employee to resign in these circumstances, however, it will remain the voluntary decision of the employee to resign, where the employer reserves his right to pursue criminal charges.
Article by: Carl Ranger
Dispute Resolution Official – Bloemfontein