The respondent, Mr Vorster, was employed by Denel (Pty) Ltd for many years and was summarily dismissed on 9 September 1996. He initially pursued relief in the Industrial Court under the Labour Relations Act 28 of 1956, but abandoned those proceedings. He thereafter sued Denel in the Pretoria High Court for damages for breach of his employment contract and for injuria. Denel’s disciplinary code, which was expressly incorporated into the employment contract, prescribed a specific two-stage procedure for dismissal involving a disciplinary committee and approval by an assistant general manager in consultation with the Assistant General Manager: Human Resources. Although Denel had substantive grounds for dismissal, it failed to follow the prescribed contractual procedure. Instead, a single assistant general manager conducted the enquiry, made the finding of guilt, and imposed dismissal without a recommendation from a disciplinary committee or the required consultation. The High Court dismissed the claims, but the Full Court upheld the breach of contract claim. Denel appealed to the Supreme Court of Appeal.
The appeal was dismissed. The order of the Full Court was amended to declare that Denel terminated the respondent’s employment in breach of his contract of employment, to dismiss the injuria claim, and to order Denel to pay the costs relating to the breach issue. A special costs order was made limiting the recoverable fees of both parties’ attorneys for failure to utilise procedural rules efficiently.
This case is a leading authority confirming that disciplinary codes incorporated into employment contracts are contractually binding and must be followed strictly. It affirms that constitutional rights to fair labour practices do not override or negate express contractual procedures, and that employers may be held liable in contract even where a dismissal is substantively fair. The judgment also reinforces principles of contractual interpretation and limits on implying tacit terms.