UNAVOIDABLE CONSEQUENCE WHERE CRIMINAL AND CIVIL PROCEEDINGS ARE INSTITUTED SIMULTANEOUSLY AGAINST EMPLOYEES – DENNIS SIBUYI

Theft, fraud, bribery and corruption are rife in the workplace which causes companies and organisations (“the employer”) to loose large sums of money. In these situations employers often find themselves with no choice but to take immediate action by suspending or dismissing the transgressing employee.

 

Once the employee has been suspended or dismissed, the issue of the lawfulness of the suspension or dismissal of the employee will take its course through the CCMA and/or Labour Court should the employee challenge the employer’s decision.  After suspension or dismissal of the employee, the employer may need to lay criminal charges and/or institute civil proceedings against the employee to recover monies lost as a result of theft, fraud, bribery or corruption.

 

Should the employer decide to lay criminal charges and institute civil proceedings simultaneously, the dispute clause mechanism contained in the employment contract that governs the relationship between the employer and employee needs to be considered? In most instances, the dispute clause obliges the employer to refer the dispute for arbitration.

 

The primary reason for having an arbitration clause as a dispute mechanism in the employment contract is to ensure that the proceedings are fast tracked and the dispute is adjudicated upon as soon as possible as opposed to the normal court process, which takes considerably longer. However, the employer’s wish to have the dispute adjudicated upon as soon as possible in order to recover the monies lost may be frustrated where there are pending criminal charges against the employee.

Our courts have, as a matter of principle, accepted that an employee is entitled to demand a stay of arbitration proceedings where there are pending criminal charges against the same employee based on similar facts as are in the arbitration proceedings.

 

 Procedurally, the employee is entitled to request the arbitrator to stay the arbitration proceedings pending the finalisation of the criminal proceedings. The employee has to show that the proceedings before the arbitrator stem from similar facts or evidence to be led in the pending criminal proceedings. The employee has to convince the arbitrator that if the arbitration proceedings are not stayed, he will be prejudiced in the conduct of his defence in the pending criminal proceedings. The employee will normally argue that he may be obliged to answer incriminating questions during the arbitration proceedings with may compromise his defence in the criminal proceedings.

 

Once the employee has proved that the continuation of the arbitration proceedings will prejudice the conduct of his defence in the criminal proceedings, the arbitrator is obliged to stay the arbitration proceedings. In the circumstances, the employer has no choice, but to wait for the finalisation of the criminal proceedings which may take months or even years to finalise before the employer can continue with the arbitration proceedings.

 

Unfortunately the above consequence is unavoidable where criminal and civil proceedings are instituted simultaneously against the employee and the employee demands a stay of the arbitration proceedings. In addition, the employer cannot choose to delay the laying of criminal charges solely to allow the arbitration to take its course in order to recover the monies lost. Employers have a statutory duty to report criminal offences committed in the workplace as soon as the employer becomes aware of the offence.

 

The least the employer can do should it find itself in the above situation is to assist the State, where possible, in the prosecution of the employee in order to speed up the finalisation of the criminal proceedings. The employer may assist in the prosecution of the employee by making resources such as additional legal assistance available to the State, and for example preparing sworn statements of the crucial witnesses as well as liaising with the investigating officer and the prosecutor. In this manner, the criminal proceedings may be finalised as soon as possible which would the permit the resumption of arbitration proceedings.