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Dismissal for dishonesty - when is it fair?

When is dismissal an appropriate sanction for an act of dishonesty by an employee?

In a case recently before the Labour Court, a senior municipal manager in a position of trust was found, during a general investigation by the Scorpions into licencing fraud, to have acted dishonestly by using a fake Namibian driver's licence to obtain a South African licence.

The Court upheld the manager's dismissal, confirming in the process the general principles in our law that trust is an important element in any employer/employee relationship, and that, as the Court summarised it: "dishonest conduct goes go to the heart of the employment relationship and is destructive of it".

However, dismissal is not always an appropriate sanction. "Where misconduct involves an element of dishonest conduct which is not gross or serious" held the Court, mitigating factors (such as remorse, length of service etc) "may (and in fact should) be considered in determining a sanction short of dismissal."

What will constitute "gross or serious" dishonesty will depend on the circumstances of each case, but it is important to note that the focus is "on the effect of the conduct on the trust relationship between the parties".

The mitigating facts put forward in this case illustrate this principle in action: -

  • There was no direct loss or prejudice at all to the employer (similarly, where there is actual loss, for example by theft, even a petty theft could in appropriate cases justify dismissal).
  • The dishonesty was committed "outside the workplace".
  • The conduct was from years ago (in this case, 9 years prior to detection by the Scorpions).

Despite these factors, held the Court, the employer was entitled to require the manager in question to be "beyond reproach", her fraud "was characterized by a high degree of dishonesty and corruption", and she had shown no remorse. Her dismissal was accordingly fair.

Every case will be different - take advice upfront on what will be an appropriate sanction in each instance.