Subject Matter/Name of Development |
Resignations with immediate effect |
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Summary |
In the case of Mthimkhulu v Standard Bank of SA, the Labour Court determined the legal position where an employee resigns with immediate effect after the conclusion of a disciplinary hearing but prior to the imposition of a sanction of dismissal. The court held that in such situation, employees will be in breach of their notice obligation, in response to which employers may either (i) accept the repudiation, in which case the employment relationship will terminate, or (ii) reject the repudiation and hold the employee to their notice period. During this period, the employment relationship continues to exist and an employer may therefore proceed with dismissing the employee. |
Impact Date |
18 September 2020 |
Employer Implications/Action Needed |
Despite the fact that a resignation is a unilateral act, employers are not required to accept resignations with immediate effect. Instead, the employer may decide whether or not to accept the resignation (which constitutes a repudiation of the employment agreement). Employer’s need not approach the court for an order of specific performance in the event that they wish to reject the employee’s repudiation of their notice period obligation (by resigning with immediate effect). |
Employer Risk |
No risk to employers. Employers should be aware that employees cannot simply resign with immediate effect. If and when employees do so, employers may decide whether to accept or reject the repudiation so that the employment ends immediately or reject the repudiation and hold the employee to their notice period. |
Subject Matter/Name of Development | Temporary Employment Services |
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Summary |
Whether an entity is a Temporary Employment Services (“TES”) may be determinative of liability for employees. In the case of David Victor & 200 others v Chep South Africa (Pty) Ltd and 3 others, the Labour Appeal Court considered whether a company should be deemed a TES. Overturning the Labour Court decision, it found a tripartite TES relationship to exist and set out guidance for determining any trigger of the TES deeming provision under section 198A(3) of the LRA, namely:
Further, that the substance of the relationship is more definitive than its form and that where a client contractually controls the overall work process of persons who work at its premises, as well as their conduct and behaviour, the employees will ordinarily be deemed employed by the client and not the TES. |
Impact Date |
16 September 2020 |
Employer Implications/Action Needed |
Where employers provide staff to their clients for reward or receive staff from external entities for reward, they should carefully consider the circumstances of the arrangement to determine whether the status may be determined as a TES. Considerations should include the degree of control as well as the extent of integration of employees. |
Employer Risk |
If the deeming provision is triggered, then either (i) the employer will become the sole employer of the employees if the employer is the client in the TES relationship or (ii) the client/s of the employer will become the sole employer of the employees if the employer is the TES in the TES relationship. The effect will be that the liability for the employees will shift to the deemed employer. |
Contact:
Sandro Milo
Partner
+27 834 4403 20
sandromilo@eversheds-sutherland.co.za