An incarcerated employee is unable to fulfil one of his main duties as an employee - to tender his service to his employer. An employer cannot reasonably be expected to retain an employee in service where the employee can no longer perform in terms of the employment contract. The question that arises, though, is whether the employee's incarceration gives rise to a justifiable ground related to conduct, incapacity or operational requirements for the dismissal of the employee? The Labour Relations Act 66 of 1995 ("the LRA") recognises these three grounds as valid reasons for the dismissal of an employee.

In the earlier decision of Trident Steel (Pty) Ltd v Commission for Conciliation, Mediation & Arbitration & Others (2005) 26 ILJ 1519 (LC), the Labour Court, per Revelas J, found that the dismissal for absenteeism of an employee who had been incarcerated (for an offence unrelated to the workplace) was unfair. The Labour Court held that if the employee's absence from work was unacceptable, there were alternatives open to the employer. The learned judge stated that the employer could, for instance, have employed a temporary employee. Alternatively, if it had no alternative but to employ a permanent employee, the employer could have retrenched the employee in accordance with its operational requirements. The employer could thus not dismiss the employee for misconduct.

In Samancor Tubatse Ferrochrome v MEIBC (Maloma & Stemmett NO) [2010] ZALAC 7, the employer apparently took heed of the Labour Court's views expressed in Trident Steel and terminated the service of an incarcerated employee for incapacity (and not misconduct). The Labour Appeal Court, per Davis JA, found that the dismissal for incapacity of an employee who was incarcerated for a considerable period was substantively fair. However, whilst the LRA recognizes incapacity as a valid ground for dismissal, it also defines incapacity as reasons relating to the employee's poor performance, injury or ill health. How does incarceration fit into either one of these grounds, considering that the incarcerated employee is not indisposed due to ill health or injury, neither is his poor work performance the reason for the dismissal?

To answer this, let's consider the facts of the case as reviewed by the Labour Appeal Court. Samancor conducts business in the mining sector. The Employee,
Mr. Maloma, was employed as a furnace operator - a key position within Samancor's organisation. On 20 May 2006, Maloma was arrested, remained in custody and was absent from work for approximately 150 days. On 30 May 2006, Maloma was dismissed on the grounds of incapacity, in that he was physically unable to tender his services. Samancor delivered a letter advising him of his dismissal to the police station at which he was being held.

On 2 November 2006 a post-dismissal hearing was held, following Maloma's release from custody. The hearing found that Samancor could not have been expected to put in place a temporary arrangement for such a period of time which would have allowed Maloma's position to be kept open for him. The position he held was an important one within the framework of Samancor's organisation. Accordingly, Maloma's dismissal was upheld.

Maloma then referred the matter to arbitration. His dismissal was ultimately found to be substantively unfair because Samancor had not properly considered that Maloma had no control over the circumstances and duration of his absence. Furthermore, when Samancor made his decision to dismiss, no opportunity was given for Maloma to present his case. Accordingly, the dismissal was also procedurally unfair. Samancor was ordered to reinstate Maloma.

On review, the Labour Court, per Francis J, agreed with the arbitrator's finding and sympathetically held that Maloma's incarceration was a "factor beyond his control... He was not the author of his own misfortune."


Both the arbitrator and the Labour Court held that the term ‘incapacity', is confined to ill health, injury or poor performance; and the reason for the employee's dismissal exceeded the defined scope of the definition of incapacity.

On appeal, the LAC found that the definition of incapacity was wider than that propounded by the Labour Court. The LAC referred, with approval, to Brassey's Commentary on the Labour Relations Act at para A8 - 76 that:

"Incapacity may be permanent or temporary and may have either a partial or a complete impact on the employee's ability to perform the job. The Code of Good Conduct: Dismissal conceives of incapacity as ill health or injury but it can take other forms. Imprisonment and military call-up, for instance, incapacitate the employee from performing his obligations under the contract...."

The LAC held that the question as to whether a dismissal based on the incarceration of an employee is substantively fair depends upon the facts of the case. An employer needs to consider the reasons for the incapacity, the extent of the incapacity, whether it is permanent or temporary, and whether any alternatives to dismissal do exist.

Samancor could not reasonably estimate the duration of the incarceration. Further, the nature of Maloma's position made it commercially necessary for Samancor to make an expeditious decision and the imperative to ensure that a similarly skilled person could assume the responsibilities.

The LAC found that it was not reasonable to expect an employer to have kept the position open and available to the employee for an indefinite period of time, particularly in circumstances where he held an important position within the organisation. The potential indefinite length of the absence from work of a person holding a position which could not easily be filled by temporary employee renders this case one of incapacity. The decision to terminate the employee's employment was fair and justifiable.

As far as procedural fairness was concerned, the LAC found that whilst it may have been impossible for employer to hold a pre-dismissal hearing while the employee was incarcerated, merely providing employee with a letter informing him in writing of the decision to dismiss him and the reasons for the dismissal while he was in prison did not constitute a fair opportunity for employee to present his case.

When the matter came before the post-dismissal hearing, the same person who presided over the initial hearing again presided. The post dismissal hearing appeared to be nothing more than confirmation of the earlier decision taken to dismiss Maloma. In the circumstances, the employee was not accorded the standard of fairness which is required in a dismissal hearing. In the circumstances therefore, the dismissal was procedurally unfair.

The appeal to the LAC was upheld and Maloma's dismissal was found to be substantively fair, but procedurally unfair on the basis that Maloma was not afforded an opportunity to be heard. An amount of compensation in the equivalent of six months remuneration calculated the rate of remuneration on the date of dismissal was awarded for the procedural unfairness.

Based on the decisions of Trident Steel and Samancor, an employer who is confronted with the dilemma of having one of its key employees incarcerated for a considerable period, may consider whether there are grounds to either retrench or dismiss him for incapacity (provided of course that the necessary procedural requirements of each ground are met). A dismissal for misconduct merely based on the employee's absenteeism from work (and where the incarceration is based on an offence unrelated to the workplace) could be found to be unfair.

Written by: Melanie Hart, Director at Cliffe Dekker Hofmeyr