Item 3 (4) of Schedule 8 (Code of Good Practice: Dismissal) of the Labour Relations Act, 66 of 1995 provides that it is generally inappropriate to dismiss an employee for a first offence, except if the misconduct is serious and of such gravity that it makes a continued employment relationship intolerable. Examples of serious misconduct, subject to the rule that each case should be judged on its merits, are gross dishonesty, assault, gross insubordination, etc.

Sub-item 5 of Schedule 8 supra provides further that when deciding whether or not to impose a  penalty of dismissal, the employer should in addition to the gravity of the misconduct consider factors such as the employee’s circumstances (including length of service, previous disciplinary record and personal circumstances), the nature of the job and the circumstances of the infringement itself.

In his book entitled Dismissal (Juta, 2014) at page 211, Professor John Grogan remarked as follows regarding Mitigating Factors:

“Mitigating factors should be considered after the employee has been found guilty of the offence; whether there are mitigating (or aggravating) factors constitutes a separate inquiry. A variety of considerations may be relevant when considering a plea in mitigation. These include a clean disciplinary record, long service, remorse, the circumstances of the offence, whether the employee confessed to his misdemeanour and any other factors that might serve to reduce the moral culpability of the employee. An employer is not required to take mitigating factors into account merely because the evoke sympathy. The test is whether, taken individually or cumulatively, they serve to indicate that the employee will not repeat the offence”

Dishonesty is generally regarded as behaviour that is untrustworthy, deceitful or insincere and intended to mislead another person. In Nedcor Bank Ltd v Frank & others (2002) 7 BLLR 600 (LAC), it was held that: “Dishonesty entails a lack of integrity or straightforwardness and in particular, a willingness to steal, cheat, lie or act fraudulently … and it is normally used to describe an act where there has been some intent to deceive or cheat.”

According to Mischke  (The breakdown of trust: Operational perspectives on the appropriate sanction” (2010) 19 CLL 71),

“Trust becomes an issue in dishonesty-related misconduct, such as theft, unauthorised possession, fraud or misrepresentation. In cases such as these, the employee’s truthfulness and honesty are placed in question, and, clearly, an employer would indeed be hard-pressed to place trust in an employee who is guilty of theft or fraud”.

In Toyota SA Motors (Pty) Ltd v Radebe & others (2000)21 ILJ 340 (LAC) at 344C-F, it was held as follows:

‘Although a long period of service of an employee will usually be a mitigating factor where such employee is guilty of misconduct, the point must be made that there are certain acts of misconduct which are of such a serious nature that no length of service can save an employee who is guilty of them from dismissal. To my mind one such clear act of misconduct is gross dishonesty. It appears to me that the commissioner did not appreciate this fundamental point. I hold that the first respondent’s length of service in the circumstances of this case was of no relevance and could not provide, and should not have provided, any mitigation for misconduct of such a serious nature as gross dishonesty. I am not saying that there can be no sufficient mitigating factors in cases of dishonesty nor am I saying dismissal is always an appropriate sanction for misconduct involving dishonesty. In my judgment the moment dishonesty is accepted in a particular case as being of such a serious degree as to be described as gross, then dismissal is an appropriate and fair sanction.’

The Labour Appeal Court has consistently followed an approach laid out early in the jurisprudence of the Labour Court in Standard Bank SA Limited v CCMA and Others [1998] 6 BLLR 622 (LC) at paragraphs 38-41 where Tip AJ said:

“It was one of the fundamentals of the employment relationship that the employer should be able to place trust in the employee… A breach of this trust in the form of conduct involving dishonesty is one that goes to the heart of the employment relationship and is destructive of it.”

In De Beers Consolidated Mines Ltd v CCMA and Others (2000) ILJ 1051 (LAC) at1058I-J, the Court further pointed out that “[t]he seriousness of dishonesty – ie whether it can be stigmatised as gross or not – depends not only, or even mainly, on the act of dishonesty itself but on the way in which it impacts on the employer’s business.”

In Kalik v Truworths (Gateway) and Others [2008], 1 BLLR (LC) the Labour Court held that an employment relationship “….broken down as a result of an act of dishonesty can never be restored by whatever amount of mitigation. The underlying reason for this approach is that an employer cannot be expected to keep dishonest workers in his/her employ. The other reason for this is to send an unequivocal message to other employees that dishonesty will not be tolerated.”

In SAPPI Novoboard (Pty) Ltd v Bolleurs (1998) 19 ILJ 784 (LAC) at para 7, the Court held as follows:

“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’….”

Written by Magate Phala, who specialises in Labour Law and writes in his private capacity. For more information, kindly contact Magate Phala at magatephala@gmail.com