A scenario that often happens is that an employee gets served with a notice to attend a disciplinary hearing and then resigns, either on or without notice.

The legal position is that an employee who resigns with notice remains an employee of the employer until the end of the notice period and the employer is allowed to discipline the employee and even dismiss him/her during the notice period.

The situation is different if the employee resigns with immediate effect. The employment relationship then terminates immediately and the employer may not hold a disciplinary hearing, quite simply because the employee is not an employee of the employer any longer.

Nothing prevents an employee who resigns on notice to terminate the employment relationship during the notice period by leaving the employer with immediate effect. The employer will be within its rights to claim damages from the employee due to the employee’s failure to work out the notice period. Such damages however need to be proved and quantified in order for the employer to succeed with a claim.

In Mtati v KPMG Services (Pty) Ltd (2017) 38 ILJ 1362 (LC), Ms Mtati was told that KPMG was investigating allegations of misconduct against her. She then resigned on notice. When she was served with a charge sheet and told that a disciplinary hearing would start during her notice period, she resigned for a second time, this time without notice and with immediate effect. Ms Mtati attended the disciplinary hearing but only to argue that KPMG lacked jurisdiction to discipline her as the employment relationship terminated summarily with her second “resignation”. Such an argument was dismissed by the chairperson of the disciplinary hearing which resulted in Ms Mtati withdrawing from the hearing. The hearing proceeded and Ms Mtati was found guilty and dismissed. Ms Mtati then brought an urgent application in the Labour Court seeking an order to declare the disciplinary process and her dismissal null and void. The judge accepted that employers may discipline and dismiss employees during the notice period in the event of a resignation.  The court however went further and found that when an employee resigns without notice and leaves immediately, the employee’s status is changed from that of an employee to that of a former employee, which deprives the employer its right to discipline the employee.

The above decision has been criticised by some since the implication is that employees may abort disciplinary action by resigning without notice and even though such summary resignation is in breach of the employee’s contract of employment by not giving notice.

The reality is accordingly that an employee is able to escape disciplinary action by resigning with immediate effect, subject of course to the risk of a damages claim.

This position was supported in a minority Constitutional Court judgment by Zondo JP in Toyota SA Motors (Pty) Ltd v CCMA [2016] 3 BLLR 217 (CC), where he stated as follows:

“Where an employee resigns from the employ of his employer and does so voluntarily, the employer may not discipline that employee after the resignation has taken effect. That is because, once the resignation has taken effect, the employee is no longer an employee of that employer and the employer does not have jurisdiction over the employee any more”.

The Constitutional Court did not deal with this issue in the majority judgment as the resignation of the employee was not raised in the Labour Court. The Mtati judgment accordingly stands. 

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