Employer Legally Permitted To Dismiss An Employee

An employer can dismiss an employee for a fair reason (this means the dismissal is ‘substantively’ fair) and only if the employer has followed a fair procedure (this means the dismissal is ‘procedurally’ fair).

There are three fair reasons for dismissal. These are:

• For misconduct (if an employee intentionally or carelessly breaks a rule at the workplace, e.g. steals company goods)
• For incapacity (if an employee cannot perform duties properly owing to illness, ill health, or inability)
• For operational reasons (if a company has dismissed an employee for reasons which are related to purely business needs and not because of some failing on the part of the employee)

A code of good practice (Schedule 8 in the Act) sets out the principles of substantive and procedural fairness to be followed in the case of dismissal for misconduct or incapacity. The principles of a fair dismissal for operational reasons are contained in the Act itself and in a code of good practice on dismissals based on operational requirements, issued by NEDLAC (National Economic Development and Labour Council). If there is a collective agreement on disciplinary procedures, the employer must comply with the procedures in the agreement.

Any termination of employment due to misconduct of the employee must be in accordance with a fair procedure and should be substantively fair.