There have been
conflicting decisions and uncertainty whether an Employer can still take
disciplinary action against an Employee who resigned with immediate effect in the face of misconduct
allegations.
In the matter
of The
Standard of Bank of South Africa Limited v Nombulelo Cynthia Chiloane,
(LAC) (reportable case no: JA
85/18) the Labour Appeal Court
found that an
employee may not resign with immediate effect to end the employment
relationship with his/her employer and so prevent an employer from proceeding with disciplinary action
during the employee’s notice period (as regulated either by the contract of
employment or the Basic Conditions
of Employment Act [BCEA]).
In this case, Standard Bank gave its employee, Chiloane, notice to
attend a disciplinary hearing, alleging that she cashed a cheque without
following proper procedures, causing Standard Bank financial loss. On the
same day that the employee received the notice to attend the disciplinary
hearing, she tendered a written letter of “resignation with immediate effect”
to her superior.
The bank told Chiloane that she was required to serve her four-week
notice period as provided for in her contract of employment. Through her attorney,
the employee maintained that her letter of resignation ended the employment
relationship with immediate effect and accordingly, Standard Bank was not
entitled to proceed with the disciplinary hearing. Despite this, the
disciplinary hearing continued in her absence and the presiding chairperson
found the employee guilty of the misconduct and recommended a sanction of
summary dismissal. Standard Bank accordingly dismissed the employee.
After having been informed of her dismissal, the employee
instituted an urgent application in the Labour Court seeking an order that her
dismissal was invalid. The Labour Court held that resignation with
immediate effect terminates the employment relationship immediately and an
employer is not entitled to require an employee to serve his/her notice
period. Accordingly, the Labour Court declared the employee’s dismissal
pursuant to the disciplinary hearing null and void.
On appeal, the Labour Appeal Court reiterated that employment
relationships are governed by contracts and/or statutes. The court held inter
alia, “In this matter, the employee’s narration that her resignation was
with “immediate effect” was of no consequence because it did not comply with
the contract which governed her relationship with her employer and the employer
was thus correct to read into the resignation a four-week notice period within
which period it was free to proceed with the disciplinary hearing.”
The Labour Appeal Court thus confirmed that where an employment
contract provides for a particular notice period, an employee is obliged to
give notice for the period provided in the contract. The contract of
employment, and reciprocal obligations contained in it, only terminate when the
period specified expires. In the absence of a contractual term, the
parties are bound by the statutory notice provisions provided for in the BCEA.
