A resignation in terms of South African law is described as a unilateral termination of a contract of employment by an employee.
In some instances, employees elect to resign when a better position becomes available, family responsibilities change or when an employee wishes to pursue another career opportunity altogether. In other instances, employees elect to resign in the face of disciplinary action out of the fear of being dismissed.
In practice, many employers are brought before the CCMA or relevant Bargaining Councils for matters relating to alleged unfair dismissal disputes, only to discover that the employee resigned pending disciplinary action.
The Labour Court in Kalipa Mtati v KPMG Services (Pty) Ltd (2017) 38 ILJ 1362, held “that the dismissal of an employee who had resigned with immediate effect was null and void since the employee had brought his contract of employment to an end by resigning with immediate effect.”
The outcome of this judgment was that employees who resigned with immediate effect before disciplinary action being instituted or concluded could not be disciplined as their employer lacked the necessary jurisdiction to discipline them. This decision gave weight to the legal principle that resignations are unilateral acts on the part of an employee which do not require acceptance on the part of the employer before becoming effective.
In a recent 2020 Labour Court Judgement, Mthimkhulu v Standard Bank of South Africa J928/20, the court was requested on an urgent basis to set aside the dismissal of an employee, in light of the fact that the employee had already resigned.
In this case, the employee was employed by Standard Bank, and on 17 August 2020, was brought before a disciplinary hearing on charges of gross dishonesty and fraud. The outcome of the disciplinary hearing was issued on 19 August 2020, whereby the Chairperson found the employee to be guilty of the misconduct as charged. The sanction in this matter was reserved pending the submission of mitigating and aggravating factors. On 21 August 2020, the employee elected to resign with immediate effect before the sanction of the disciplinary hearing could be issued. Standard Bank, took note of the employee’s resignation, however, elected to hold the employee to his 30-day notice period as per his contract of employment. Thereafter, on 24 August 2020, Standard Bank issued the employee with the outcome of the disciplinary hearing, which was a summary dismissal.
The employee alleged firstly, that Standard Bank lacked the necessary jurisdiction over him as he had already resigned from their employment, effective 21 August 2020. Secondly, that Standard Bank should nullify the dismissal from his record and amend his termination to that of resignation.
The court, in this matter, raised the legal issue that the Labour Court lacked jurisdiction in this matter, as the employee was required to refer his alleged unfair dismissal dispute to the CCMA for adjudication.
The court went into further analysis of this matter, whereby the learned Judge referred to the minority decision of Judge Zondo J in the matter of Toyota South Africa Motors (Pty) Ltd v CCMA and Others (2016) 37 ILJ 313 (CC) which held: “since a valid resignation is incapable of being withdrawn, an employer has no right to discipline once resignation has taken effect.”
In this case, Standard Bank indicated in writing that they did not accept the employee’s resignation with immediate effect but indicated that they would require the employee to fulfil the contractual obligation of his 30-day notice period. The court held:
“Where one party to a contract, without lawful grounds indicates to the other party an unequivocal intention no longer to be bound by the contract, that party is said to repudiate the contract.”
In light of the above, the court held that the resignation of the employee before the announcement of the sanction of summary dismissal had no legal effect. In conclusion, the Labour Court held that they lacked the necessary jurisdiction to entertain this matter and advised the employee to refer his alleged unfair dismissal to the CCMA for adjudication.
Employers are reminded that a resignation is a unilateral act on the part of an employee that does not require any acceptance to take legal effect. Should an employer elect to compel an employee to serve the required notice period in terms of the contractual obligations, nothing prevents an employer from taking disciplinary action against such an employee throughout the said notice period.
Article by: Tammy Barnard
Dispute Resolution Official – Pretoria