Procedurally and substantively unfair dismissals do not guarantee the employee a remedy - Dr DC Kemp v Dr Rawlins 

The Labour Appeal Court recently denied an employee relief for an unfair dismissal. The employee’s dismissal was held to be both procedurally and substantively unfair by the Labour Court and the Labour Appeal Court, however, both courts refused to grant the employee any relief for unfair dismissal.

In casu, the Appellant, a medical practitioner, conducted his medical practice in Bloemfontein. In 2007 he purchased a second medical practice and employed the Respondent in that practice. The Respondent ran the satellite practice independently of the Appellant. The Respondent became pregnant and advised the Appellant thereof. The parties agreed that the Respondent would take maternity leave on 1 February 1998.

The Appellant testified that, despite all his efforts to make the satellite practice successful it continued to run at a loss. On the day before the Respondent was to commence her maternity leave, he informed her that she should attempt, during her maternity leave, to find alternative employment. The Appellant testified that later that day the Respondent’s husband telephoned him demanding that he give the Respondent written notice that her employment had been terminated to which he complied. The Respondent on the other hand testified that on 31 January 1998 she had gone to collect her salary cheque at the Appellant’s home where he advised her that he could no longer retain her in his employ as she was too expensive. She responded by saying that she could not work for a lesser salary because her husband was still a student. The Appellant then reacted by telling her that he had already employed someone else in her place. Her services were thus terminated.

After hearing oral evidence the Labour Court held that the dismissal was based on the Appellant’s operational requirements but that it was both procedurally and substantively unfair. The Labour Court ordered the Appellant to pay the Respondent twelve months salary as compensation amounting to R120, 000.00. On appeal to the Labour Appeal Court it was common cause that the dismissal was both procedurally and substantively unfair and this court had to determine whether or not compensation should have been awarded to the Appellant pursuant to her unfair dismissal, and if so whether the award of 12 months compensation was just and equitable in the circumstances.

Before the matter could be heard by the Labour Court the Appellant made an offer to the Respondent’s trade union offering to reinstate the Appellant alternatively to make a payment to her in settlement of the dispute. The Respondent refused the settlement offer on the reasons outlined below. The Labour Court found that the Respondent had acted “entirely reasonably” in refusing the Appellant’s offer of reinstatement whereas the Labour Appeal Court in a partially dissenting judgment held that it may have been more correct to have said that the Respondent did not act unreasonably in refusing the offer of reinstatement. The Respondent’s refusal of reinstatement led the majority of the Labour Appeal Court judges to refuse her any relief for unfair dismissal.

Two Labour Appeal Court judges held that:

“It is important that when the Respondent was cross examined by counsel for the appellant, he elicited that the reason why the Respondent had not accepted the appellant’s offer of reinstatement was that her working relationship with the Appellant had been totally destroyed and that she did not trust him anymore.”

The Labour Appeal Court held that the Labour Court completely failed to apply its mind to the fact that the Respondent had secured alternative employment at a better level of remuneration in September 1998 which left the Respondent “out of pocket” for four months.

A few principles are highlighted and explained in this judgment which includes the employer’s “right to right a wrong”. The Labour Appeal Court held that since the offer was genuine and reasonable, there is no reason why the Appellant must be ordered to pay compensation which would not have arisen if the Respondent had accepted the offer of reinstatement. The Court held that it is very important to affirm the employer’s “right to right a wrong” that he or she has made in these kinds of circumstances. The Labour Appeal Court held that if an employer unfairly dismisses an employee and he wishes to reverse that decision, he must be able to do so, and if the employee fails to accept that offer for no valid reason, the employer has a strong case in support of an order denying the employee compensation.

The Labour Appeal Court, although the dismissal was both procedurally and substantively unfair, refused to grant the Respondent any relief for unfair dismissal. Both parties were ordered to pay their own costs in the Labour Appeal Court and Labour Court.

It will be interesting to see how the Supreme Court of Appeal views this matter should it go on appeal. In light of the Labour Appeal Court’s interpretation of the discretion given to the Labour Court or an arbitrator in terms of section 193(1)(c)  and section 194 (1)of the Labour Relations Act 66 of 1995, this may be a matter that may end up at the Constitutional Court. The Supreme Court of Appeal and the Constitutional Court may have to decide inter alia whether the right of an employer to right a wrong weighs heavier than an employees’ right not to be unfairly dismissed especially when the dismissal is both procedurally and substantively unfair.

Lesley Mokgoro

Director: Phatshoane Henney inc