When does a breakdown of trust justify employee dismissal?

The breakdown of trust: has it become an easy way to get rid of employees, particularly senior managers or executives?

The starting point in answering that question lies in the key elements of any employment relationship, namely:

• The duty of good faith;
• Honesty;
• Integrity;
• Avoiding conflicts of interest;
• Being subordinate to your employer at all times.

These elements may sound easy to fulfil, however, it is relatively commonplace for employees to encounter challenges insofar as ensuring 100% alignment with some or all of them.

The unfortunate reality for employees is that these elements are non-negotiable. An employee owes a duty of good faith to the employer, irrespective of circumstances.

Employers require their employees to be honest, trustworthy and not to do anything that may lead to a breakdown of trust. Employers are therefore entitled to expect their employees to abide by their command and the rules, save in respect of anything that is unlawful or illegal.

Our labour laws have gone a long way in protecting employees against what may be seen as “excessive use of power”. One of their fundamental rights is fair process.

This means an employer cannot simply allege there is a breakdown of trust and terminate the contract without affording that employee an opportunity to respond to the allegation and to defend himself or herself in a formal inquiry.

In many instances, it would be expected of an employer to conduct an investigation, collect evidence and analyse such evidence objectively before deciding whether to discipline the employee.

It is critically important that if a decision is made to discipline an employee in relation to an alleged breakdown of trust, that the inquiry be conducted before an independent person, with witnesses giving evidence in support of or in rebuttal of the allegations.

Of course, certain forms of misconduct, once proven, go to the heart of an employment relationship and will warrant dismissal in the first instance. This includes most forms of dishonest conduct, blatant insubordination and/or gross negligence.

The fact that the misconduct warrants dismissal, however, does not absolve employers from following a fair procedure and conducting a disciplinary process in terms of which the employee is given a right to be heard.

With regards to conflict of interests, case law principles are clear: without an employer’s permission, an employee cannot work for another employer, let alone compete against that employer. Once established, the employer can dismiss that employee.

Where the disciplinary inquiry has been waived, for example by way of a contractual term, then the agreed upon process should be followed.

Employers should not simply dismiss employees for alleged breakdown of trust without affording accused employees the opportunity to defend themselves in an internal inquiry, private arbitration or an inquiry by an arbitrator (section 188A process).

Failure to do so may result in a finding that the dismissal was procedurally and/or substantively unfair.

Courts have become hesitant in granting urgent interdicts in circumstances where an employer may argue the employee has an alternative remedy. Employees should get proper advice prior to launching an urgent application against the employer in court.

– Osborne Molatudi is a practising attorney specialising in employment and labour law.

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