Bringing Company Name into Disrepute

“Team Work: Coming together is the Beginning; Keeping together is Progress; Working together is Success” – Anonymous

Article by Joshua Nattar (Senior Labour Advisor)

Introduction

In a customer driven environment, it is quite common for employees to be charged with “bringing the employer’s name into disrepute,” especially in instances whereby a complaint is escalated to the employer’s customer care department.

What does bringing a company into disrepute mean?

According to the Collins dictionary, “If something is brought into disrepute or falls into disrepute, it loses its good reputation, because it is connected with activities that people do not approve of”.

The Merriam-Webster dictionary, defines the terms as “to give (something) a bad name”.

Therefore, from the above, it is clear that if an employee’s conduct damages or potentially damages a company’s reputation, then this conduct is termed as bringing a company into disrepute.

Interestingly, liability can extend to conduct outside of the workplace as well as conduct outside of working hours, provided there is a causal connection between the employee’s off-duty misconduct and the employer’s business.

John Grogan says that: ‘Improper Conduct’ (conduct unbecoming) is a residual offence, which overlaps with other offences. However, the offence of ‘bringing the employer’s name into disrepute warrants special mention because it is sometimes treated separately by the courts and arbitrators or is regarded as an aggravating factor if an employee is found guilty of some other offence which also entails general impropriety”.

Usually, the charge of bringing the company’s name into disrepute is coupled with some other form misconduct, for example, theft or dishonesty. However, it can be a stand-alone charge, depending on the circumstances.

Examples

There is a multitude of examples, such as: where an employee displays offensive behaviour towards a client; or defames the employer; or makes disparaging remarks about the manner in which the employer conducts its business; or even derogatory or racial comments on social media.

Peruse this MISA article about Social Media conduct and the impact it may have on your employment.

Case Law

At a glance, the charge of bringing a company into disrepute does not seem to be that serious. However, the disciplinary code of many companies provide a sanction of dismissal, even for a first offence.

The Constitutional Court in Sidumo v Rustenburg Platinum Mines Ltd [2007] 12 BLLR 107 (CC), provides that each case must be assessed on its own merits, and further, that evidence must be assessed in its totality.

In the matter of Timothy v Nampak Corrugated Containers (Pty) Ltd [2010] ZALC 56 LAC, the Labour Appeal Court (LAC) reiterated that there must be “an objective evaluation as to whether the appellant [employee] brought the company into disrepute… An objective test means that a decision maker has to examine the entire context in which the conduct alleged, has taken place and the effect thereof”.

In this matter, Mr. Timothy (employee) fraudulently purported to be an attorney, acting on behalf of the employer. He further threatened the employer’s client’s attorney with legal action, in the event that his demands were unmet; and finally, because of his actions the company deemed his conduct to have brought the company into disrepute.

The LAC confirmed that the dishonest conduct of an employee has the potential to call into question the reputation of the employer. Confirming, “in these circumstances, where there is nothing more than an aggressive denial and a perpetuation of dishonesty, it is extremely difficult to justify a progressive sanction, particularly in a case where the dishonesty is as serious as this dispute”.

MISA wishes to emphasise that employees owe a duty of the utmost good faith to their employers.

The failure of an employee to act with good faith towards his employer was dealt with by the LAC in the case of SAPPI Novoboard (Pty) Ltd v Bolleurs [1998] 5 BLLR 460, stating “it is an implied term of the contract of employment that the employee will act with good faith towards his employer and that he will serve his employer honestly and faithfully.… The relationship between employer and employee has been described as a confidential one. The duty which an employee owes his employer is a fiduciary one ‘which involves an obligation not to work against his master’s interests’…. If an employee does ‘anything incompatible with the due or faithful discharge of his duty to his master, the latter has a right to dismiss him’….”

Conclusion

Members are encouraged to be mindful of the duty of utmost good faith to the employer and not to do anything that will call their integrity into question, as this conduct may result in bringing the name of the employer into disrepute.

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