Edcon Limited v Padayachee and Others (J331/16) [2018] ZALCJHB 307 (20 September 2018)

Principle:

Where an employer seeks to dismiss an employee on grounds of incompatibility, this is not primarily an enquiry into poor performance or misconduct. In order to prove incompatibility, independent corroborative evidence in substantiation is required to show that an employee's intolerable conduct was primarily the cause of the disharmony.

Facts:

The employee was employed as the Group Remuneration and Benefits Manager. During 2014 the employer received several complaints from various members of staff. The complaints were around work ethic and the employee's ability to collaboratively work within a team. These complaints were brought to the employee's attention but the employee did little to address the complaints and an action plan submitted by her addressed only one of several complaints. An attempt was made to arrive at a mutual termination of employment, but this failed. A formal investigation was conducted which resulted in a decision that the employee should be summoned to an incapacity hearing to deal with the alleged incompatibility. An incapacity enquiry was conducted, which resulted in the employee being dismissed for incompatibility.

Aggrieved by her dismissal, she referred a dispute of alleged unfair dismissal to the CCMA. In arbitration her dismissal was found to be unfair. The employer proceeded to the Labour Court to review the arbitrator's award. At the Labour Court the arbitration award was upheld. The LC found that the dismissal for incompatibility was unfair as the employer's evidence focused on poor performance and misconduct, and not on incompatibility. The Court also emphasised that internal grievance procedures should be used to resolve these type of matters, and commented that there may be instances where lethargic employees may label a results-driven manager as being incompatible.

For conduct to be regarded as incompatibility it must depart from a recognized, conventional, or established norm or pattern. There must also be a clear causal link between the disharmony and the conduct.

The lesson of this case is that where an employer seeks to dismiss an employee on grounds of incompatibility, this is not primarily an enquiry into poor performance or misconduct. In order to prove incompatibility, independent corroborative evidence in substantiation is required to show that an employee's intolerable conduct was primarily the cause of the disharmony.

Extract from the judgment:

MOSHOANA, J

[9]   In considering the applicant's grounds of review, it is important to note that if the commissioner has determined the principal issue and gave the parties a fair opportunity to put up their respective cases, a judge cannot substitute an outcome simply because he or she would have arrived at a different outcome. It is by now trite that an employer can only justify a dismissal by proving the reasons that led to a dismissal. In casu, it is common cause that poor work performance and insubordination were not the reasons that led to the dismissal of the first respondent. Accordingly, the dismissal of the first respondent cannot be justified with reference to poor work performance and insubordination.

[10]   It must follow axiomatically that the ground that the second respondent failed to find justification of the dismissal with reference to poor work performance and insubordination should fail. He was not obliged to. The reason why the first respondent was dismissed is that she was found to be incompatible. If the applicant failed on a preponderance of probabilities to show that the first respondent was incompatible, then the dismissal was not for a fair reason.

[11]   Failure to apply one's mind entails taking into account irrelevant considerations and ignoring the relevant ones. The focal point for the second respondent was whether the first respondent was incompatible or not. Incompatibility arises in a situation where there has been a breakdown in the employment relationship because inter-personal relationships are tense, conflictual or lacking in harmony. The golden rule is that prior to reaching a decision to dismiss, an employer must make some sensible, practical and genuine efforts to effect an improvement in interpersonal relations when dealing with a manager whose work is otherwise perfectly satisfactory.

[12]   The offending employee has to be advised what conduct allegedly causes disharmony, who is upset by the conduct, and what remedial action is suggested to remove the cause of the disharmony. A reasonable period must be allowed for the employee to make amends. Dismissal may be appropriate only where the employee's eccentric behaviour is of such a gross nature that it causes consternation and disruption in the workplace. The employee must have been properly warned or counselled. The incompatibility must be one that is irremediable.

[13]   Almost 24 years ago, the Labour Appeal Court (LAC), as it then was constituted, in SA Quilt Manufactures (Pty) Ltd v Radebehad the following to say:

"We are of the view that the court below was correct in finding that the procedure adopted by the appellant in dismissing the respondent was inadequate and unfair. However, the facts would seem to indicate that the appellant may well have had grounds to terminate the employment of the respondent on account of the unrest that developed in its workforce as a result of the animosity towards the respondent. However, it adopted the wrong procedure and thereby treated the respondent unfairly.

[14]   The leading judgment emanating from this court on the subject seem to be that of Jabari v Telkom SA (Pty) Ltd where this court said the following:

"In order to prove incompatibility, independent corroborative evidence in substantiation is required to show that an employee's intolerable conduct was primarily the cause of the disharmony...

[15]   Might I add, where necessary, an employer must invoke and or insist on the internal grievance policy. There are many instances where lethargic employees may label a resultsdriven manager as being incompatible. The cause of disharmony in such instances would be the insistence on results and lack of shoddiness. The conduct of insisting on diligence cannot be an intolerable conduct. The conduct must be one departing from a recognized, conventional, or established norm or pattern. There must be a clear causal link between the disharmony and the departing conduct. Where there is no evidence that the conduct is the cause of the disharmony, then an employer must fail. The evidence of Samodien was nothing else but a litany of acts of misconduct and poor performance. She did not show that there was disharmony caused by the first respondent. The same goes with the evidence of Holding. Lotter's evidence was no different.

[16]   It is also clear that what Ramothwala was investigating was not necessarily the cause of the disharmony but the litany of acts of misconduct and poor performance as presented to her by Samodien. That was a wrong procedure adopted. Similarly, Dolo was effectively conducting a poor performance hearing as opposed to determining whether the conduct of the first respondent was the cause for the disharmony. In SA Quilt supra, the LAC said:

"It was correctly pointed out in the judgment a quo that if a worker behaves in such a manner that he or she is incompatible with the other staff, that worker can be dismissed. There must be, however, a proper inquiry to establish that the fault lies with the worker. Mere incompatibility caused by other workers does not justify the unfair treatment of the worker who cannot get on with the others..."

[17]   The investigation by Ramothwala and the enquiry by Dolowas not focused on whether the fault of disharmony lies with the first respondent but on whether the first respondent is a performer or not. Such is a wrong enquiry. For the reasons set out above, there is no basis for me to conclude that the decision by the second respondent that the dismissal of the first respondent is unfair is one that a reasonable decision maker may not arrive at.

[18]   Turning to the remedy. I am unable to fault the remedy of reinstatement with backpay. Having found that the dismissal is substantively unfair, unless the exceptions exist, the remedy of reinstatement cannot be denied. The only possible exception applicable to this matter is one in section 193 (2) (d) - the circumstances surrounding the dismissal are such that a continued employment relationship would be intolerable. Intolerability is not based on views of other employees but based on sufficient evidence that the trust relationship is broken and is irreparable. In casu, the Human Resources Business Practitioners merely expressed their frustrations, which is not sufficient to deprive the first respondent of her primary remedy.

[19]   In the result, I make the following order:

Order

  1. The application for review is dismissed.
  2. The applicant is to pay the first respondent's costs.