Work In Solutions

Case Number: J 2543 / 08

Judgment Date: 23 March 2009

Jurisdiction: Labour Court, Braamfontein

Judge: Van Niekerk J

Subject: Suspension without Pay

Issue: Urgent application to declare employee’s continued unpaid suspension unfair and to order the Employer to pay his remuneration.

Summary of Facts: The employee was a Technical Director at a salary of R40 000.00 per month.  He had purchased 30 shares in the company from existing shareholders in the company for R1.8 million.  On signature the employee was to pay R500 000 in part payment of the shares.  This agreement contained a clause to the effect that, should the employment of any shareholder be terminated on a count of misconduct, that party would be obliged to dispense his shareholding to other shareholders for no purchase consideration.  On 24 July 2008 the employee was advised by the auditor of the company that the Employer demanded his immediate resignation.  The Employer also offered to purchase his shares at this time for an amount of R300 000, which was to include R120 000 in arrears salaries.  The Employee refused to resign and on 30 July 2008 he was suspended pending an investigation.  On 1 August 2008 the Employer advised creditors that the Employee was no longer employed by the company.  A disciplinary enquiry was convened on 26 August 2008 and postponed to 08 September 2008 and eventually started on 22 September 2008.  On 29 September 2008 the employee was found guilty on three of the seventeen charges of misconduct brought against him. On 07 October 2008 the employee filed an application in LC (this court) for an order declaring the employer to be in breach of its contractual obligations and failing to pay him the remuneration that he had not received for 2 months.  He also claimed that his suspension was unfair. The day after application to declare the suspension unfair was lodged, the employer dismissed the employee with immediate effect.

Summary of Judgment: The employer argued that financial hardship and loss of income can never be grounds for urgency.  The court held that each case must be assessed on it own merits, and that an application should not be refused only on this basis.  The court has a wide discretion to determine the urgency with which application should be treated.  Regarding the non-payment of remuneration, the court held that it was not persuaded that the employee did not have the right to receive monthly remuneration of R40 000.00.    The court further held that that, where suspension was effected as a measure pending a disciplinary hearing, suspension without pay was a material breach of contract. In the absence of any apparent apprehension that the employee’s continued presence in the workplace prejudiced a legitimate business interest, the suspension was also held to be unfair.   It was clear that the dismissal had been a direct response to employee launching his application in the Labour Court and, far from being academic, it smacked of an act of victimisation.  The court was satisfied that the employee had made out a case for the relief he sought and made an order declaring the suspension to be unlawful.  It also ordered the Employer to pay the employee his remuneration for the months of his suspension as well as costs.