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Constructive Dismissal: Was it really the final straw?

By Jade Groenewald, Labournet Industrial Relations Team Leader - May 9, 2017
Constructive Dismissal: Was it really the final straw?

The concept of a “Constructive Dismissal” has been defined in The Labour Relations Act in Section 186(1), as the following: “an employee terminated a contract of employment with or without notice because the employer made continued employment intolerable.”

This is considered a dismissal as defined by law and may result in a compensation award to the maximum of twelve (12) months should an adverse arbitration award be made by a commissioner, as reinstatement is simply not an appropriate remedy should working conditions be intolerable.

The issue in dispute in these cases will always be whether an employee’s dismissal was coerced or whether the employee resigned voluntarily, with the employer arguing the latter. The onus of proof will however be on the employee.

How does an employee prove this? In Solid Doors (Pty) Ltd v Commissioner Theron & Others (2004) 25 ILJ 2337 (LAC) the LAC held as follows: “... there are three requirements for constructive dismissal to be established. 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.”

Therefore, for an employee to prove constructive dismissal, the employment contract must be terminated by resigning. The employee must be able to show that he intended to continue with the employment relationship but was unable to do so under the circumstances.

It must be remembered that this is an objective test, and is not what the employee subjectively considers to be intolerable working conditions. As Commissioner Brand in Peers and Minolco (Pty) Ltd (2000) 9 CCMA 6.13.2 put it: “The treatment must be sufficiently hostile, harsh or antagonistic to meet the standard the word “intolerable” sets, and sensitive employees have no moral claim to better protection than their colleagues – even more so if the employer has not been made aware of the reasons for the employee’s sensitivity.”

It is required that the intolerable circumstances must be likely to endure for some time without the employer taking corrective action or indicating an intention to correct the situation. Importantly, the employee must have had attempted other means to have the situation addressed by the employer.

The employee cannot sit back and not bring the alleged intolerable circumstances to the attention of the Department of Labour, the CCMA, or by following an internal Grievance Procedure. There must objectively be no other option for the employee, but to terminate the employment contract. The circumstances must convey the picture of an employee who resigned “out of desperation as a last resort”.

Lastly, the reason for resignation must be as a result of the employer creating an unbearable situation in the workplace. The alleged intolerable circumstances must be created or perpetuated by the employer, or as in most circumstances, by a senior employee of the employer.

Simply put, the employer is required to “construct” a dismissal, and should it not be for the employer’s conduct – the employee would have been able to work indefinitely.

What about resigning in the face of disciplinary action? This has been rejected as a ground for a constructive dismissal, as the mere threat of conducting a disciplinary enquiry will not be grounds for unfair or unlawful conduct by an employer. Because, an employee can challenge the fairness of his dismissal at a later stage.

In the end, constructive dismissal is not easily proven and employers should not readily accept alleged claims of constructive dismissal.