Contractual disputes abridged with clarity - Pre CCMA or Labour Court Settlement Agreement lawful and binding - Constitutional Court (“the CC”)

In Gbenga-Oluwatoye v Reckitt Benckiser South Africa (Pty) Limited and Another (2016) 37 ILJ 2723 (CC), the Constitutional Court (“the CC”) it was held that full and final settlement clauses, which provide for the finality of a dispute are common and lawful and not contrary to public policy. With reference to the signed settlement agreement. The Constitutional Court concluded that the intentions of the parties were clear, since the employee agreed to part ways with his employer on final terms. In addition, this Constitutional Court case also confirms that the use of waiver clauses by employers which restrict access to the CCMA or courts remain lawful and that parties (employers and employees) may settle their disputes on such terms which are agreeable to them. As a result, when the employer – employee relationship has deteriorated in the workplace “soft exit” which involves settlement agreement or separation agreement must be approached with full understanding of the consequence and the limits of remedies thereafter. This means, unless otherwise proven to be tainted by duress, undue influence, and/or misrepresentation, the contract will be lawful and binding between parties. This decision of the highest court is important to both employees and employers within the workplace.