South African Maritime Safety Authority v McKenzie

Mr Fafie Fortune McKenzie was employed by the South African Maritime Safety Authority (SAMSA) as its chief internal auditor. He was dismissed on 1 March 2005 and alleged that the dismissal was procedurally and substantively unfair. He pursued remedies under the Labour Relations Act 66 of 1995 (LRA) and settled with SAMSA for an amount equivalent to one year’s salary. Thereafter, he instituted an action in the High Court claiming damages for breach of his contract of employment, alleging that the contract contained an express, alternatively implied or tacit term that it would not be terminated without just cause. He claimed damages of approximately R5.2 million, calculated on the basis that he would have remained employed until retirement. SAMSA raised special pleas contending that the High Court lacked jurisdiction and that the LRA provided the exclusive remedies for unfair dismissal.

The appeal was upheld. The order of the High Court was set aside and replaced with an order dismissing the plaintiff’s claim. Each party was ordered to pay its own costs, both in the court below and on appeal.

This case is a leading authority clarifying the distinction between statutory unfair dismissal rights under the LRA and contractual rights arising from contracts of employment. It confirms that section 185 of the LRA does not create a contractual right not to be unfairly dismissed and that unfair dismissal claims must be pursued through the statutory mechanisms and remedies provided by the LRA. The decision limits attempts to claim common-law contractual damages for unfair dismissal beyond the LRA framework.