Can an employer dismiss an employee for lying?

Jun 28, 2017

The answer to the question is YES!
Lying is a form of dishonesty and depending on the circumstances may be serious enough to warrant dismissal. This is because it could make an employment relationship intolerable because it damages your ability to trust the employee.
Mosselbay Municipality won a dismissal case because of an employee’s dishonesty, in Mr J van der Merwe vs Mosselbay Municipality (2009) 18 SALGBC 8.23.3
The facts of the case:
Johan Leon van der Merwe, a manager for socio-economic development, was employed on 1 October 2007. At the time of applying for the position, he stayed in Oudtshoorn. He thought he could travel from Oudtshoorn to Mosselbay on a daily basis. The total distance was 101km.
He signed a rental agreement and received a subsidy of R250 a month from the company. After a week, van der Merwe realised it was difficult and decided it would be best to rent a flat closer to work.

In terms of the company’s policy, an applicant who applied for a subsidy must give proof of the rental agreement. Van der Merwe signed the agreement for the period 8 October 2007 – 8 February 2008. The subsidy payments reflected on his payslips every month. However, he had been claiming this subsidy when he was not even staying in the flat in Oudtshoorn. The company charged him with gross dishonesty and fraud. He was dismissed on 5 August 2008. Van der Merwe said that he thought that they had automatically stopped paying the subsidy and did not check his payslip.
Stop paying the subsidies
Van der Merwe did not come to work on 4 April 2008. Edward William Jantjies, a director to whom Van der Merwe reported to, had an important tender and needed Van Der Merwe’s assistance. He could not get hold of Van der Merwe and asked the salaries department to check if Van der Merwe’s address was correct. He saw they were still paying the subsidy even though Van der Merwe told him in November 2007 that he had trouble with his children and would go back to travelling from Oudtshoorn to Mosselbay after the rental agreement expired. Jantjies told the salaries department to stop subsidy payments to van der Merwe.
Van der Merwe made no attempt to stop the subsidy
Jantjies regarded this dishonesty as a serious matter and that he could not trust Van der Merwe. Johannes Jacobus Ebersohn, a practicing attorney, signed the rental agreement with Van der Merwe. He said that on 7 January 2008 Van der Merwe told him that he was not going to continue with the rental agreement. Ebersohn made a note on the rental agreement that Van der Merwe had ended the agreement verbally.
Results of the case:
The arbitrator found Van der Merwe’s argument about not checking his payslip an unlikely story. He also stated that Van der Merwe had no intention or made any efforts to stop the subsidy payments. The suggestion that Van der Merwe thought they had automatically stop payments was unproven. Being a manager, the onus was on him to ensure the subsidy was stopped.

Jantjies proved that Van der Merwe committed an act of gross dishonesty and so his dismissal was substantively and procedurally fair.
There are five serious offences that, in most cases, deserve instant summary dismissal, even for a first offence:
  • Gross dishonesty
  • Gross insubordination
  • Deliberate damage to company property
  • Putting other employees at risk; and
  • Unprovoked assault
Before employers decide if they should dismiss an employee for gross dishonesty, make sure that a fair procedure has been followed.

The content does not constitute legal advice, are not intended to be a substitute for legal advice and should not be relied upon as such. Kindly contact us on or 021 556 1075 to speak to one of our consultants.


Wallace Albertyn

Wallace Albertyn is a Senior Associate and Legal Advisor at LabourMan Consultants.

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