11 December 2020 by and Employment Law Alert

The issue is now settled: Resignation with immediate effect cannot be used as a mechanism to escape disciplinary action

The Labour Appeal Court (LAC) has finally resolved the debate as to whether an employee’s resignation with immediate effect negates an employers’ right to discipline an employee during their notice period. In the judgment of Standard Bank of South Africa Limited v Chiloane (handed down on 10 December 2020), the court confirmed an employers’ right to discipline an employee during their notice period irrespective of whether an employee has resigned with immediate effect.

The LAC confirmed that resignation with immediate effect does not terminate the employment relationship where the employee’s contract of employment stipulates a notice period. Where an employee resigns with immediate effect, notwithstanding their contractual obligation to serve a notice period, the employment relationship will terminate at the election of the employer, who may either waive the employees’ obligation to serve a notice period or seek not to enforce it. Where an employer elects to enforce their rights to an employee working their contractual notice period, an employer may discipline an employee during their notice period, regardless of whether an employee has resigned with immediate effect.

Where parties have not agreed to a notice period, section 38 of the Basic Conditions of Employment Act 75 of 1997 will apply.

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