Strategic Liquor Services v Mvumbi, T NO and Others

Strategic Liquor Services employed Wesley Redgard as a merchandising supervisor and regional manager from October 2003 to February 2004. After a customer complaint, the employer's manager (Mr Sellars) gave Redgard a choice between resigning with one month's salary and a good reference, or being warned and placed on a poor work performance programme. Redgard testified that the complaints were false and that management was against him, so he resigned because he believed he would be fired anyway. He claimed constructive dismissal. At the CCMA hearing on 8 October 2004, Redgard was the only witness to testify under oath. The employer's manager made only arguments and submissions without testifying. The CCMA found constructive dismissal and awarded Redgard compensation of ten months' salary (R121,500). The employer sought review in the Labour Court, which dismissed the application on 20 February 2007. The employer then unsuccessfully sought leave to appeal to the Labour Appeal Court and then the Supreme Court of Appeal before approaching the Constitutional Court.

• Whether the CCMA correctly applied the test for constructive dismissal under section 186(e) of the Labour Relations Act
• Whether the employee had a genuine choice between resigning and remaining in employment
• Whether an employee must have 'no choice' but to resign for constructive dismissal to be established
• Whether the failure by the Labour Court to provide written reasons for its judgment violated the employer's constitutional right of access to courts under section 34 of the Constitution
• Whether there is a constitutional or common law duty on judges to provide written reasons for their decisions when requested for appeal purposes

The application for leave to appeal was dismissed with costs.

The binding legal principles established are: (1) For constructive dismissal under section 186(e) of the Labour Relations Act, it is not necessary that the employee have no choice but to resign; it is sufficient that the employer made continued employment intolerable for the employee. (2) Where an employee's uncontested evidence establishes that continued employment was intolerable and that alternatives to resignation were a sham, constructive dismissal is established. (3) While there is no express constitutional provision requiring judges to furnish reasons, failure to provide written reasons when requested for appeal purposes ordinarily violates the constitutional right of access to courts under section 34 of the Constitution. (4) Reasoned judgments are indispensable to the appeal process and fundamental to the rule of law, judicial accountability, and transparency.

The Court made several important non-binding observations: (1) It endorsed comments from the Supreme Court of Appeal deploring 'systemic delays' in the Labour Courts, noting that the entire scheme and philosophy of the LRA are directed at cheap, easy access and speed of resolution, and that delays are untenable and unfair to both employees and employers. (2) It stated that it is 'elementary' that litigants are ordinarily entitled to reasons for a judicial decision following a hearing, and that written reasons are indispensable when a judgment is appealed. Failure to supply them is 'usually a grave lapse of duty, a breach of litigants' rights, and an impediment to the appeal process'. (3) It noted that reasoned judgments discourage unmeritorious appeals, explain decisions to parties and the public, curb arbitrary judicial decisions, enable informed decisions about appealing, assist appeal courts, and provide guidance to the public. (4) It stated tentatively (without deciding definitively) that where a decision is subject to appeal, withholding reasons would 'ordinarily be a violation of the constitutional right of access to courts'. (5) It commented that 'it is a grave matter when courts themselves infringe rights in the Bill of Rights and it must be hoped that this occurrence is and will remain extremely rare'.

This case is significant for several reasons: (1) It clarifies the test for constructive dismissal under section 186(e) of the Labour Relations Act, confirming that an employee need not have 'no choice' but to resign - it is sufficient that the employer made continued employment intolerable. (2) It strongly criticizes systemic delays in the Labour Courts and emphasizes that speed of resolution is fundamental to the scheme and philosophy of the LRA. (3) It addresses the constitutional importance of judges providing written reasons for their decisions, particularly when judgments are subject to appeal, indicating that failure to provide reasons may violate the section 34 right of access to courts. (4) It emphasizes judicial accountability and the rule of law, noting that it is a grave matter when courts themselves infringe rights in the Bill of Rights.