An Age-Old Question: A Discussion on the Constitutional Court Judgment in Great South Autobody v Landman

Recently, the Constitutional Court had the opportunity to interpret Section 187(1)(f) read with Section 187(2)(b) of the Labour Relations Act in Motor Industry Staff Association and Another v Great South Autobody CC t/a Great South Panelbeaters (2025) 46 ILJ 481 (CC) (20 December 2024).

The Facts

Mr Landman was employed by Great South Panelbeaters as a procurement officer in 2007. The parties concluded an employment agreement specifying Mr. Landman’s retirement age as 60 years old. Mr. Landman turned 60 on 15 March 2018. The employer was aware that he had reached retirement age but did not terminate his employment at that time. Instead, Mr Landman continued working as usual, receiving his salary, with no mention of retirement or retirement age in 2018.

On 14 January 2019, ten months after Mr Landman had reached retirement age, the employer issued a notice letter informing him that his employment would terminate based on his having reached retirement age, with his last working day set for 19 February 2019. Accordingly, the employer terminated Mr. Landman’s service based on age.

Mr Landman challenged his dismissal, contending that it was automatically unfair under Section 187(1)(f) of the Labour Relations Act. He argued that the employer had waived its right to enforce the agreed retirement age or that a new tacit agreement had been established when he was allowed to continue working beyond that age.

The employer, in turn, relied on Section 187(2)(b) to argue that the dismissal was not automatically unfair. It asserted that once an employee reaches the agreed retirement age, Section 187(2)(b) is satisfied, and in the absence of a specific agreement to the contrary, the employer may terminate employment at any time thereafter—provided sufficient notice is given.

Proceedings at the Labour Court

The employer was successful in its argument before the Labour Court, where Van Niekerk J relied on the judgment in Schweitzer v Waco Distributors (A Division of Voltex (Pty) Ltd) (1998) 19 ILJ 1573 (LC). The court concluded that the employer was entitled to terminate Mr. Landman’s services based on age, even though the dismissal occurred months after he had reached retirement age. Accordingly, the court found the dismissal to be fair.

The Labour Appeal Court

Aggrieved by the Labour Court's decision, Mr Landman appealed to the Labour Appeal Court, which upheld the lower court’s ruling and agreed with its conclusions.

The Constitutional Court

The matter produced a three-way split in the Constitutional Court.

• Four members of the Constitutional Court (Zondo CJ, Chaskalson AJ, Mathopo J, and Schippers AJ) concluded that a dismissal under Section 187(2)(b) of the Labour Relations Act is fair onlyif the termination occurs on the date the employee attains their normal or agreed retirement age—unless an agreement or collective agreement specifies otherwise. If an employee reaches the agreed retirement age on a date other than the last day of the month, the agreement may stipulate that the last working day will be the month's end. Any termination based on age at a later date is automatically unfair.
• A fifth member of the Court, Van Zyl AJ, held that once an employee reaches the agreed retirement age, the employer has the discretion to terminate employment based on age, governed by ordinary contractual principles. However, if the employer fails to exercise this option within a reasonable period, they may be found to have elected not to terminate the employee’s employment.
• The remaining four members of the Court (Rogers J, Dodson AJ, Kollapen J, and Tshiqi J) ruled that once an employee reaches their agreed retirement age, Section 187(2)(b) allows the employer to terminate employment at any time thereafter, provided reasonable notice is given. However, the judgment highlights the desirability of affording the employee a hearing before termination.

Two of the judgments dismissed the appeal to the Constitutional Court—though for different reasons. Ultimately, the majority ruled that the appeal should be dismissed. However, the judgment makes it clear that there are vastly differing opinions regarding the interpretation of age-related provisions by the apex court.

What Does This Mean for Employers?

The three-way split and differing interpretations highlight the importance of employers providing clarity on retirement age. Employers should:

• Ensure that employment contracts explicitly state the agreed retirement age.
• Track when each employee reaches retirement age to determine whether they will be terminated or retained.
• If terminating employment based on retirement, notify the employee immediately upon reaching the agreed retirement age.
• If retaining the employee, consider concluding a fixed-term or consultancy agreement to govern the employment relationship going forward.