“Oh, what a tangled web we weave, when first we practice to deceive!” (Sir Walter Scott)
The company that runs Cape Town’s V&A Waterfront appointed a chief information officer in October 2015. A year later, a credit check contradicted something she had said at her interview, and the company investigated her employment history.
She was dismissed in December 2016 after a disciplinary enquiry, and the company sued her in the Labour Court for its losses. She did not testify or cross-examine the company’s witnesses, despite opportunities to do so.
What had she told the employer?
She said she had voluntarily left three previous employers: one because of a merger, one because she had been headhunted, and one for career development. All three had dismissed her, two for misconduct and one for poor performance.
She did not disclose that she was still employed by a university, which went on paying her salary while she worked for the company. The Court said this breached both the requirement to obtain written consent for outside employment and her duty of good faith. This alone would have justified cancelling her employment contract.
When the company offered her R700,000 a year, she sent a letter claiming that the university had offered her a better-paid post. No such offer had been made. The company raised its offer to R850,000.
Why were the damages equal to her remuneration?
The Court found that the employer would never have employed her had it known her true employment history. It held that the employer was entitled to cancel the contract and be restored to the position it would have been in had it not employed her.
The evidence showed that she did not deliver a single piece of work within her brief and used working hours for her private business. Because the employer had obtained no value from her services, the Court awarded damages equivalent to her remuneration.
The award was R1,031,237.46, calculated on a cost-to-company basis. Her net pay was R597,114.40.
What about the consultants?
During her employment, she arranged for the company’s outsourced IT provider to engage two consultants who had worked for her private business, without disclosing the connection. The company’s procurement policy required dealings with suppliers to be at arm’s length and free of conflicts of interest.
The Court found that the consultants would probably not have been appointed had she acted honestly and in good faith. It ordered her personally to pay the employer R1,866,005 in damages for the consultants’ fees. The order was against the former employee, not the consultants.
This brought the total damages to R2,897,242.46, plus interest and legal costs.
What does this mean for employers?
The finding that the employer received no value from her services was central to the remuneration award. The judgment should not be read as saying that every misrepresentation on a CV means the employee must repay everything they were paid.
It does show that an employer deceived into an appointment can sue for its losses after dismissing the employee.
Prevention is better than cure
Check before you hire. Ask candidates whether they resigned, were dismissed, or left under a settlement, and verify their answers directly with previous employers. Verify any competing offer used to negotiate a higher salary, too. Those checks could uncover dishonesty before it becomes an expensive problem.
Hiring for a senior position, or concerned that an employee misled you to get the job? Speak to us about your options.
Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice.
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