Can I resign with immediate effect to avoid disciplinary action?

“You can avoid reality, but you cannot avoid the consequences of avoiding reality” – Ayn Rand

Introduction

We have received a number of queries recently, from MISA members, asking the question, “What can my employer do if I resign in the face of disciplinary action?” The short answer to your question is: “The employer can still proceed with the disciplinary hearing.”

We have found that it has become the norm amongst employees to resign, in an attempt to avoid disciplinary action. The motivation behind making this decision, with many employees, to avoid being dismissed and having a tarnished name, in an attempt to make it easier to find employment again. In some instances however, employers still proceed with the disciplinary hearing and dismiss the employee after their resignation!

It is a well-established principle that resignation is a unilateral act and that it does not need to be accepted by your employer.  In this article we will explore the relevant case law, to answer your question whether it is possible to resign to avoid disciplinary action.

In recent years, there were conflicting judgments regarding this very issue, however, the latest case in December 2020 settled the matter.

The Naidoo Case

In the matter of Naidoo and Another v Standard Bank SA Ltd and Another (J1177/19) [2019] ZALCJHB 168, employees were issued with disciplinary hearing notices and resigned with immediate effect. The employer ensued and proceeded with the disciplinary hearings, citing that employees were contractually still within their notice period, and as such they had the right to discipline the employees.

The Labour Court ruled that there was indeed a breach of contract by the employees, however also concluded that the employer had no power or jurisdiction to discipline the employees, as there was no longer an employment relationship and they were now regarded as former employees. The Labour Court found that the employer had the right to seek order, of specific performance in terms of the material breach of contract, to hold the employees liable for their notice period.

The employees approached the Court for an interdict, which was granted and the employer was consequently interdicted from proceeding with the intended disciplinary enquiries against the employees.

From this judgment it is clear that employers cannot discipline employees, regardless of the type of offence, after they resign with immediate effect, unless they are successful in approaching the Court for an order of specific performance to give them the right to hold the employee to their notice period.

The major consequence of this would result in employees who committed serious acts of misconduct, including sexual harassment and dishonesty, not being called to account for their actions.

The Mthimkhulu Case

In the recent case of Mthimkhulu v Standard Bank of South Africa (J928/20) [2020] ZALCJHB 201, the Labour Court had to reconsider the Naidoo case. In this matter, the set of facts were slightly different.  In this instance, the employee resigned after he had his disciplinary hearing. The employee was found guilty and resigned before his dismissal was effected. The employer held the employee to his notice period and proceeded to dismiss the employee. The employee, in turn, brought an urgent application to set aside his unlawful dismissal.

In this ruling the Judge found that premature termination of an employment contract, by an employee, amounts to a repudiation of the contract. Citing contract law, the Labour Court subsequently found that the employer has the ability to reject the abandonment of the employment contract by the employee, without having to approach the Court for an order of specific performance. As such, the employer may discipline and dismiss an employee who resigns with immediate effect with the sole purpose of avoiding disciplinary action. The ruling goes further and states that in the event that an employee repudiates or abandons his contract of employment, the employer must consider accepting the repudiation and sue for damages, or reject the repudiation and hold the employee to their notice period.

This case rejects the previous view and sets out that it would not be necessary for the employer to approach the Court for an order of specific performance in order to exercise its election to hold the employee to their notice period, and that the employer is merely required to notify the employee of its decision, thereby rejecting the employee’s repudiation.

The final nail in the coffin

This matter was finally settled in December 2020 in the matter of The Standard of Bank of South Africa Limited v Nombulelo Cynthia Chiloane (JA85/18), where the Labour Appeal Court held that the employment relationship does not terminate when an employee resigns with immediate effect when their contract makes provision for a notice period. The ruling states that employers have the right to discipline employees during their notice period, irrespective of whether the employee resigned with immediate effect or not. It sets out that in the event that an employee, who is contractually bound to a notice period, resigns without notice, the employer can elect when to end the employment relationship – either seek to enforce, or to waive the employee’s notice period.

Conclusion

If you opt to resign with immediate effect you may not be able to escape disciplinary action and possible dismissal; the final decision to proceed with disciplinary action lies in the hands of your employer.

If you find yourself in a sticky situation where you are considering resigning to avoid disciplinary action, contact MISA to assist you in potentially negotiating a mutual termination, on your behalf, with your employer!

Kindly utilise the following e-mail addresses and links for assistance during this time:

Employer UIF/TERS Submissions                  UIFClaim@ms.org.za

Legal/Labour-related enquiries                      Legal@ms.org.za  

Legal Reception                                                011 476 3920

MISA Benefit claim-related enquiries            Claims@misa.org.za   

Any other enquiries                                          Info@ms.org.za  

Website                                                              www.misa.org.za    

Mobile App                                                        https://onelink.to/w9a7ku