This blog was co-authored by Hlonela Mayosi and Heidi Davis, associate designates

A recent decision in the Constitutional Court has provided legal certainty on the application of section 193(2)(b) of the Labour Relations Act, 1995 (the LRA), which relates to reinstatement of employees as the primary remedy when a court or tribunal declares a dismissal unfair.

In Booi v Amathole District Municipality and Others [2021] ZACC 36, the court held that section 193(2)(d) demands consideration of the tolerability of a continued employment relationship before reinstatement can be ordered. Furthermore, a high threshold is required for departure from the primary remedy of reinstatement.

The applicant was employed by Amathile District Municipality as a senior manager of municipal health services.  The applicant was charged with misconduct and following a disciplinary hearing, where he was found guilty of all charges levelled against him, he was dismissed in December 2015.

Aggrieved by the outcome, the applicant approached the Bargaining Council in an attempt to have the outcome overturned. The arbitrator exonerated the applicant of all charges of misconduct and further found that the dismissal was substantively unfair. In applying section 193(2) of the LRA, the arbitrator ordered that the applicant be reinstated retrospectively.

The respondent took the award on review to the Labour Court. The Labour Court found that although the cumulative evidence levelled against the applicant was insufficient to sustain a finding of misconduct, the manner in which the applicant had conducted himself was completely destructive to the prospect of a continued employment relationship. Though the Labour Court agreed that the dismissal was indeed unfair, it set aside the arbitrators award of retrospective reinstatement and substituted an 8 month compensatory award. When the matter was taken on appeal to the Labour Appeal Court the application was dismissed on the basis of their being no prospects of success.

The applicant then approached the Constitutional Court. The crux of the applicant’s case was that he ought to have been reinstated in terms of section 193 of the LRA as he was exonerated of all misconduct charges. The constitutional court has created a precedent on the applicability of reinstatement in cases where an employee has been exonerated of all charges taking into account allegations of pre-emption and intolerability of a continued employment relationship.

The doctrine of pre-emption pertains to the fact that the conduct of a person, following judgment, may be clearly inconsistent with an intention to appeal the judgment. The Labour Court had refused to grant the applicant leave to appeal to the Labour Appeal Court on the basis that by demanding and receiving payment awarded by the Labour Court, the applicant had a clear intention to abide by the judgment of the Labour Court. The Labour Court held that pre-emption was an unfortunate consequence of the misconduct of the applicant’s attorneys. The Labour Appeal Court agreed to hear the appeal of the Labour Court Judgment. During his submissions, the applicant held that he had no knowledge of pre-emption and the consequences of his demand for payment on his right to appeal.

It was the conclusion of the Constitutional Court that the applicant showed relentless pursuit in appealing the matter which included his personally drafting the application for leave to appeal to the Constitutional Court. The applicant further did not actively seek alternative employment as his focus was being re-instated and this lead to financial hardship. It was understandable that the applicant incorrectly thought the financial impediment of the costs of an appeal could be overcome by the compensation awarded by the Labour Court. These actions prove that he never indicated any intention to waive his right to appeal. The court stressed the central endeavour of safeguarding employment in South Africa in order to counter widespread joblessness, poverty and exploitation of employees in South Africa. Thus, the court ruled that, given the applicant’s lack of legal knowledge coupled with his desperate circumstances and poor legal advice, the policy considerations weighed in favour of not enforcing the doctrine of pre-emption.

The court went on to provide a precedent on when a court may raise the issue of the intolerability of the continued employment relationship. The court confirmed that a court can raise an issue on its own accord when it is necessary to dispose of the matter and where the interests of justice permit. In accordance with Moodley v Department of National Treasury [2017] ZALAC 5; (2017) 38 ILJ 1098 (LAC), it is a failure not to take cognisance of section 193(2) and to consider whether reinstatement might be inappropriate.  Therefore, section 93(2) requires a court to consider the intolerability of the working relationship prior to making an order for reinstatement regardless of whether the parties themselves have brought up the issue.

When a dismissal is found to be substantively unfair an employee must usually be reinstated or re-employed. This was a deliberate choice by the Legislature to ensure the rights of individual workers are protected as well as to achieve the objects of industrial peace and to reduce exorbitant costs. To do this, the legislature has set the bar of intolerability very high. The employment relationship must be completely unbearable and one that is difficult, fraught or sour will not pass the high bar of intolerability. The Court confirmed that a conclusion of intolerability should not be easily reached and an employer must be able to provide weighty reasons supported by tangible evidence for a court to reach a conclusion of intolerability of the continued employment relationship. This evidentiary burden is heighted where an employee has been exonerated of all their charges as it is grossly unfair to punish individuals with unemployment even though they are not guilty of any wrongdoing. Therefore, the same evidence used to prove misconduct will not be enough to prove intolerability of the employment relationship.

The Constitutional Court therefore concluded that the enquiry regarding a breakdown in the employment relationship is based on an objective standard, as opposed to the employer’s subjective views, and given that the applicant was found not-guilty, the arbitrator was correct in ordering reinstatement.

Employers should be aware that although a relationship with an employee has soured, that does not mean an employee who has been charged with misconduct and found not guilty should be punished with unemployment and simply paid compensation, especially in circumstances where that employee is facing financial hardship. Furthermore, the intolerability of the continued employment relationship must always be taken into account where reinstatement is on the table and employers should consider whether they have weighty evidence to support non-reinstatement if a case of employee misconduct is taken to court. Above all employers should remember that South Africa is full of poverty and joblessness and they should avoid, as far as possible, adding to that.