Brief Summary

Employment Law — Unlawful termination of salary — Applicant, an employee of the first respondent, sought urgent relief for the alleged unlawful termination of his salary without notice or consultation. The first respondent contended that the applicant had absented himself from work without authorization, triggering a clause in his contract that allowed for termination of employment. The court held that the first respondent's failure to provide notice or engage in a disciplinary process before terminating the applicant's salary constituted a breach of the employment contract, and the applicant was entitled to the payment of his salary for February 2022.

Comprehensive Summary

Summary of Judgment

Introduction

The proceedings took the form of an urgent application in the Eastern Cape High Court, Mthatha, in which the applicant sought final relief arising from the non-payment of his salary. The applicant, Ndiviwe Dukiso, was an employee of the first respondent, King Sabata Dalindyebo Local Municipality (K.S.D). The second respondent was the Municipal Manager of K.S.D, and the third respondent, Dial Kettledas, was described as an agent of the municipality and the applicant’s direct line of reporting within the relevant department.

The matter was heard on 18 March 2022 and judgment was delivered on 19 April 2022. The respondents opposed the application. Although issues of urgency were raised by the respondents in relation to the applicant’s timetable for service and filing, the court accepted the respondents’ answering affidavit as timeously filed in the circumstances.

The general subject-matter concerned the lawfulness of the municipality’s conduct in terminating (or withholding) the applicant’s salary for February 2022, and whether the respondents were entitled to do so on the basis that the applicant’s contract of employment had allegedly terminated under a contractual “unauthorised absence” provision, or alternatively that the absence fell to be treated as leave without pay under the contract.

Material Facts

It was common cause that in September 2005 the applicant and the first respondent concluded a written contract of employment in terms of which the applicant was employed as a law enforcement officer. The employment letter embodied the terms and conditions of employment, and it was common cause that clause 43 incorporated the municipality’s Disciplinary and Grievance Codes and Procedures and other attached instruments into the contract. It was also common cause that the applicant was entitled to a monthly salary payable on the 25th day of each calendar month (or the last working day before that date) during the subsistence of the employment relationship.

It was further common cause that the applicant initially reported for duty at Mqanduli municipal offices, and that in November 2018 he agreed to the municipality’s requirement (facilitated and communicated by the third respondent) that he would report in Mthatha in the law enforcement by-law section.

The immediate event precipitating the litigation was that on the February 2022 salary pay date the applicant was not paid his salary. When he enquired at the salary section, an official (Sinalo) initially provided him with a payslip, but upon checking the computer system informed him that his salary had been terminated, with no reason recorded. The human resources department also could not provide him with a reason. He was advised that the termination was at the instance of the third respondent. A letter of demand sent by the applicant’s attorneys elicited no response.

The respondents’ version was that, after the applicant’s reporting site changed, his attendance became sporadic and that in February 2022 he did not report for work and rendered no services. They alleged that by 21 February 2022 fourteen days had elapsed without the applicant reporting for duty, without authorisation, and without the municipality being notified of a valid reason. On that basis, the respondents relied primarily on clause 22(h) of the contract, contending that the applicant’s unauthorised absence for more than fourteen days meant he had “discharged himself from service,” that the contract had terminated, and that no salary was due. They also asserted that the February 2022 salary advice had been issued in error.

In reply, the applicant disputed the allegation that he had been absent from work during the relevant period and contended that he had not been given notice, called upon to show cause, or consulted before the salary termination. He placed reliance on the contract’s integration with municipal policies and collective arrangements, including internal Human Resources Policies and Procedures and the Disciplinary Procedures Collective Agreement (DPCA) (circular 01/2018), which, on his version, required engagement and process before a termination (or deemed termination) could be implemented in circumstances of alleged absenteeism.

The court identified a material factual dispute as to whether the applicant was at work during February 2022. It noted that the applicant first learned that the asserted reason for non-payment was alleged absenteeism only from the answering affidavit, and therefore could only respond substantively in reply. Applying the approach to disputes of fact in motion proceedings, the court found it difficult to accept the applicant’s assertion that he was present at work during February 2022, particularly because the “recorded incidents” relied upon by the applicant were not tied to February 2022.

Legal Issues

The central legal questions were whether the applicant was entitled to payment of his salary for February 2022, and whether the respondents were entitled, without more, to terminate (or withhold) the salary on either of two bases.

The first basis was the respondents’ contention that the contract of employment had terminated by operation of clause 22(h) upon unauthorised absence exceeding fourteen days, such that the municipality had no ongoing obligation to pay salary. The second, alternative basis was that even if the contract had not terminated, the municipality was entitled under clause 30 to treat the absence as leave without pay, thereby justifying non-payment.

The dispute therefore required the court to address (i) a dispute of fact (whether the applicant was absent), (ii) a question of law and contractual interpretation (the meaning and operation of clause 22(h) in the context of the contract as a whole and incorporated policies), and (iii) the application of the interpreted contractual and policy framework to the established factual position, including evaluative consideration of whether the municipality’s process was premature or unjustified on the facts accepted for motion proceedings.

Court’s Reasoning

The court approached the factual dispute with reference to established principles governing final relief in motion proceedings. It applied the rule that final relief may be granted only if the facts stated by the respondent, together with admitted facts in the applicant’s papers, justify such relief, and it considered the clarification in later authority concerning the quality of denials. On that basis, and given the absence of February-specific substantiation for the applicant’s claimed attendance, the court held that it would be difficult to find that the applicant was present at work during February 2022.

Having proceeded on the footing that the applicant was absent as alleged, the court turned to the key interpretive and procedural issue: whether the respondents were entitled to treat clause 22(h) as bringing about automatic termination of the employment relationship without any notice or engagement. The respondents argued that once absence exceeding fourteen days without a valid notified reason was established, the contract terminated by operation of the clause, and no hearing, notice, or representations were required.

The court rejected that construction after interpreting clause 22 within the wider contractual scheme, including clause 43, which expressly incorporated disciplinary and grievance procedures and related municipal instruments. In doing so, the court applied interpretive principles emphasising the unitary exercise of considering text, context, and purpose, and the place of the provision within the scheme of the agreement as a whole. The court reasoned that reading clause 22 as permitting a “one size fits all” termination without process (save for clause 22(d), which explicitly refers to dismissal subject to disciplinary procedures) created difficulty, particularly given the breadth of clauses such as clause 22(i) (breach of contract) and clause 22(j) (any other lawful reason). In the court’s view, such an approach would undermine the incorporation of disciplinary and related policies via clause 43.

The court considered that even where clause 22(h) might apply, notice would not be a mere formality. Notice would identify the operative termination date and, importantly, provide the employee an opportunity to advance reasons for absence or otherwise engage the employer. The court stressed that, on the facts, the applicant had not been advised that his contract was regarded as terminated and had not been asked to explain the alleged absence, despite being at work at least on 4 March 2022. The court found further support for this conclusion in the municipality’s internal framework, including provisions in the Human Resources Management Policies and Procedures requiring notification to the employee about the status and termination of employment.

The court also took into account factual features inconsistent with a genuine, implemented termination of the employment relationship. It noted that the alleged termination did not appear to have been recorded within the municipality’s finance or human resources departments, and that the issuance of a salary advice was, in context, more consistent with an intention to pay than a mere administrative error. The court further regarded it as significant that the alleged termination rationale was communicated only when the answering affidavit was filed.

The court then addressed the respondents’ alternative defence based on clause 30, namely that unauthorised absence could be treated as leave without pay. Proceeding again on the footing that the applicant had been absent, the court accepted that clause 30 contemplated consequences for absence without leave, but it emphasised that the municipality had not communicated with the applicant to require an explanation or to advise him that the absence would be treated as leave without pay. This remained the case even after the applicant made enquiries about his unpaid salary and was at work at least on 4 March 2022.

The court reasoned that, without such engagement, the applicant was deprived of an opportunity to explain his absence and to trigger considerations which could be relevant under an employment framework, such as whether leave credits existed that could be set off, and how any deduction should be calculated and accounted for. The court held that the applicant’s litigation stance that he was not absent (a stance the court did not accept on the papers) did not exonerate the respondents from providing the opportunity contemplated by the broader contractual and policy context. The court also observed that the applicant’s failure to address clause 30 in detail occurred in circumstances where he had not been informed that absenteeism was the basis for the non-payment, contributing to the court’s view that the respondents’ approach caused the dispute to reach court without the circumstances being properly explored through appropriate internal steps.

Ultimately, the court concluded that the municipality’s termination of the applicant’s salary was premature and not justified, and noted that if, after due process, the municipality became entitled to deduct an amount equivalent to the days of absence, it could still do so from future emoluments or other monies due under the employment contract.

Outcome and Relief

The court ordered that the respondents reinstate the applicant’s salary retrospectively from February 2022.

The respondents were ordered to pay the costs of the application.

Cases Cited

Stellenbosch Farmers’ Winery Ltd v Stellenvale Winery (Pty) Ltd 1957 (4) SA 234 (C).

Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd [1984] ZASCA 51; 1984 (3) SA 623 (A).

Capitec Bank Holdings Limited and Another v Coral Lagoon Investments 194 (Pty) Ltd and Others (470/2020) [2021] ZASCA 99 (9 July 2021).

Natal Joint Municipal Pension Fund v Endumeni Municipality 2012 (4) SA 593 (SCA).

Phenithi v Minister of Education and Others 2008 (1) SA 420 (SCA).

Masinga and Others v Chief of South African National Defence Force and Others (51 of 2021) [2022] ZASCA 1 (5 January 2022).

Legislation Cited

No legislation was expressly cited in the judgment.

Rules of Court Cited

No specific rules of court were expressly cited in the judgment.

Held

The court held that, on the papers and applying motion-proceedings principles to the factual dispute, the applicant could not be accepted as having established that he was present at work during February 2022.

The court nevertheless held that the respondents were not entitled, without notice and compliance with applicable internal processes incorporated into the contract, to treat clause 22(h) as producing an automatic termination of employment and thereby to terminate the applicant’s salary. The non-payment of salary was found to be premature and unjustified in the circumstances, including because the alleged termination was not properly communicated or recorded and because the relevant notice-based process was not followed.

The court further held that reliance on the alternative “leave without pay” approach under clause 30 likewise required engagement and notice to the employee, which had not occurred. The salary was ordered to be reinstated retrospectively from February 2022, with costs.

LEGAL PRINCIPLES

The judgment applied the principle that where final relief is sought in motion proceedings and a material dispute of fact arises, the court determines the matter on the respondent’s version together with facts admitted by the respondent, unless the denials are not genuine or the facts cannot be denied. This approach was applied to resolve the contested question of the applicant’s attendance during February 2022.

The judgment applied modern principles of contractual interpretation requiring a unitary consideration of the language used, read in its context and in light of the purpose of the provision, as well as the place of the provision within the scheme of the instrument as a whole. The contract was interpreted as requiring that clause 22(h) be read together with incorporated disciplinary and human resources instruments, rather than as a self-standing mechanism producing automatic termination without process.

The judgment further applied the principle that where an employment contract incorporates disciplinary codes, grievance procedures, or human resources policies as part of the contractual framework, an employer’s reliance on contractual provisions dealing with termination or unpaid absence must be assessed in light of the procedural and notice requirements contemplated by that integrated framework, and a unilateral salary termination implemented without such steps may be premature and unjustified, even if absence is established on the papers.

Dukiso v King Sabata Dalindyebo Local Municipality (K.S.D) and Others (2056/2022) [2022] ZAECMHC 8 (19 April 2022)