Insight on Dismissal Relating to Retirement Age: The Landman Case

1. Introduction

The Landman case, Motor Industry Staff Association and Another v Great South Autobody CC t/a Great South Panelbeaters, adjudicated by the Constitutional Court of South Africa, examined the fairness of dismissing an employee based on an agreed retirement age. The Constitutional Court issued judgment in December 2024. The case presented a legal dispute regarding whether an employer retains the right to dismiss an employee after allowing them to continue working beyond the agreed retirement age. The differing perspectives of Chief Justice Zondo and Justice Rogers reflected contrasting interpretations of the Labour Relations Act (LRA), particularly in relation to section 187(2)(b). This article explores the background of the case, the key arguments from each judgment, and the final ruling.

2. Background and Dismissal of Landman

The Landman case, revolved around the dismissal of Willem Frederick Landman, an employee at Great South Autobody CC t/a Great South Panelbeaters. Landman was employed as a procurement officer in 2007, and his employment contract explicitly set his retirement age at 60. Upon reaching this age on 15 March 2018, Landman continued working without any formal agreement extending his employment. The employer did not immediately terminate his contract but allowed him to continue working for another ten months. However, on 14 January 2019, he was notified that his employment would end on 12 February 2019, due to him having reached the agreed retirement age.

Landman contested his dismissal, arguing that the employer had waived its right to enforce the retirement clause by allowing him to work beyond 60, and that his dismissal constituted unfair discrimination based on age. His case progressed through the Labour Court and Labour Appeal Court before reaching the Constitutional Court.

3. Different views of the Judges

This case was heard by a total of 9 judges of the Constitutional Court. 3 Judges agreed with Chief Justice Zondo’s judgment, while another 3 concurred with Justice Rogers’ view. Justice Van Zyl’s opinion aligned closely with Rogers’ judgment, bringing the total to 5 judges, the majority, who found Landman’s dismissal fair. The key distinction between Justice Rogers’ and Justice Van Zyl’s reasoning lies in the timing of termination based on age: Justice Rogers held that termination may occur at any point after the employee reaches the agreed retirement age, whereas Justice Van Zyl maintained that termination must occur within a reasonable time after that age is reached.

4. Zondo CJ’s Judgment

Chief Justice Zondo took a more employee-centric approach, emphasizing that an employer cannot indefinitely rely on a previously agreed retirement age after an employee has been allowed to work beyond that age without a clear agreement. According to Zondo, the protection provided by section 187(2)(b) of the Labour Relations Act (LRA) – which permits dismissal based on age when an employee reaches the agreed or normal retirement age – was no longer applicable by the time Landman was dismissed.

Zondo held that once an employer permits an employee to continue working beyond retirement age without a fresh agreement stipulating a new retirement condition, the employer effectively waives its right to later enforce the agreed retirement age arbitrarily. He found that Landman’s dismissal, having occurred ten months after he turned 60, constituted unfair discrimination on the basis of age and thus was automatically unfair under section 187(1)(f) of the LRA. He would have awarded Landman maximum compensation of 24 months’ remuneration, including costs against the employer in the Labour Court, Labour Appeal Court and Constitutional Court.

5. Rogers J’s Judgment

In contrast, Justice Rogers took a more contractual and employer-friendly approach. He held that an employer retains the right to terminate employment at any point after an employee has reached the agreed retirement age, provided reasonable notice is given. He disagreed with the notion that allowing an employee to continue working beyond the agreed retirement age automatically nullifies the retirement provision in the contract. For all intend and purpose, an employee is on ‘borrowed time’ after having reached an agreed retirement age.

Rogers reasoned that the LRA does not impose a rigid timeframe within which an employer must enforce retirement. Instead, it allows for flexibility, enabling an employer to retain an employee past the agreed age and dismiss them at a later stage if necessary. According to him, the fact that Landman continued working did not create a new contract, nor did it imply that the employer had forfeited its right to terminate his employment under section 187(2)(b). Thus, he found the dismissal to be fair.

6. Conclusion: The Court’s Final Decision

Ultimately, the Constitutional Court found that Landman’s dismissal was fair, since the majority judges ruled in favour of the employer. The ruling reinforced that an employer does not lose the right to rely on an agreed retirement age simply because it initially allows an employee to continue working beyond that age. This decision underscores the principle that employment contracts retain their binding nature unless explicitly varied or superseded by a new agreement.

The case serves as a significant precedent in South African labour law, clarifying the extent to which employers can rely on retirement provisions and highlighting the importance of explicit agreements when extending employment beyond the agreed retirement age.

It is worth noting that, if not for Justice Van Zyl’s finding—that the termination of Landman’s employment occurred within a reasonable time after he had reached his agreed retirement age—Landman would have succeeded in his claim of automatic unfair dismissal and/or unfair discrimination. As such, employers are strongly advised to exercise caution when considering termination based on retirement age. We recommend that you consult with us before taking any steps to terminate employment on this basis, to ensure full compliance with applicable labour laws and to mitigate legal risk.

7. My favourite quote from this judgment:

“A dismissal based on age is fair “if the employee has reached the normal or agreed retirement age”. The words I have quoted from section 187(2)(b) are straightforward. If somebody asks me today if I have reached my 65th birthday, I would say yes, even though today is not my 65th birthday. If a request is made to a group of people, “Will all those who have reached the age of 65 please raise their hands”, nobody would understand the question to be limited to those whose 65th birthday it is. All those people who were 65 or older would raise their hands. The state of having reached a specified age starts on the person’s relevant birthday and continues thereafter for as long as the person lives. A person doesn’t cease to have reached her 65th birthday because she is 66 or 67.”

“The first judgment holds (the judgment of Zondo), paradoxically I respectfully suggest, that if the employer “misses the boat” by failing to dismiss the employee on the employee’s exact retirement-age date, the employer cannot put this right by dismissing the employee at a later date. Instead, the employer has to keep the person on indefinitely unless and until there are grounds for a fair dismissal based on misconduct, incapacity or operational requirements. Effectively, the first judgment gives the employer an election, save that it has to be exercised only on the retirement-age date. If the right to dismiss is not exercised on that exact date, the right to dismiss the employee on grounds of age is forever lost.”

RAYMOND JOUBERT

THE LABOUR GROUP

raymond@thelabourgroup.co.za