NOT IN CONTEMPT OF COURT: VAGUE SETTLEMENT SAVES EMPLOYER FROM BAD-FAITH TRAP - LABOURNET

Robertson and Cain (Pty) Ltd. and Theo Loock successfully appealed a Labour Court contempt ruling in a case highlighting the critical need for precise drafting in settlement agreements. In a judgment delivered on 14 January 2026, the Labour Appeal Court set aside the contempt order, emphasising that non-compliance alone does not prove wilful bad faith without clear evidence. This win, secured by skilled attorneys at Snyman Attorneys, offers vital guidance for employers, HR professionals, and labour practitioners navigating contempt of court claims.

Case Background

Randall Moses, a carpenter employed by Robertson and Cain, sustained work-related back injuries leading to exhausted sick leave and limited attendance – only 32 days worked. The company conducted a fair incapacity inquiry from August to November 2019, where Moses confirmed his inability to work but failed to provide a promised neurosurgeon’s report. Following his dismissal for incapacity – not formal medical boarding – the employee referred an unfair dismissal dispute to the Metal and Engineering Industries Bargaining Council (MEIBC).

The parties reached a settlement agreement on 11 February 2020, later certified as an arbitration award under Section 142 of the Labour Relations Act (LRA) on 9 August 2023 which was made an enforceable court order under Section 143. Clause 10.1 vaguely stated: “The Respondent agrees to assist with the completion of the forms as required by the Applicant, as applicable to the employer.” Moses interpreted this as requiring employer assistance with UI-2.2 forms and others for Unemployment Insurance Fund (UIF) permanent disability benefits, but the employer sought medical documentation first, repeatedly offering help conditional on that evidence.

Labour Court Ruling

Moses launched contempt proceedings, claiming that the employer wilfully defied the order.

On 19 September 2024, the Labour Court found Robertson and Cain and its representative guilty of contempt, imposing a suspended R100,000 f ine and mandating referral to a neurosurgeon, payment for assessment, and form completion. T he Court interpreted the ambiguous clause contextually, dismissing the employer’s ‘erroneous’ UI-19 and service certificate notations of medical boarding as proof of formal boarding, and inferred bad faith from non-compliance.

Key Legal Principles Reinforced The Labour Court’s interpretation of the settlement agreement extended beyond the order’s plain terms, adding unpleaded relief such as neurosurgeon referral. For HR practitioners, it underscored risks when settlements lack specificity, potentially exposing employers to sanctions despite genuine compliance efforts.

Successful Appeal Strategy

Appealing under case no CA 125, heard on 4 November 2025 before Molahlehi JP, Djaje AJA, and Kganyago AJA, the appellants – represented by A.J. Posthuma of Snyman Attorneys – argued that the Labour Court misapplied contempt tests from Fakie NO v CCII Systems (Pty) Ltd.

They stressed the order’s lack of clarity on specific forms, no evidence of Moses’s medical boarding, and their good-faith condition of medical proof, which Moses never supplied. The Labour Appeal Court meticulously dissected interpretation principles from Natal Joint Municipal Pension Fund v Endumeni Municipality, rejecting judicial rewriting of ambiguous agreements. It ruled no proof beyond reasonable doubt of deliberate, mala fide breach, as the employer consistently affirmed willingness to assist pending documentation – a reasonable stance aligned with UIF processes.

Key Legal Principles Reinforced

Contempt requires proving a clear order, knowledge, non-compliance, and wilful bad faith beyond reasonable doubt; mere delay or dispute over meaning falls short. Drawing from Matjhabeng Local Municipality v Eskom Holdings Ltd and Secretary of the Judicial Commission of Inquiry v Zuma, the judgment clarifies that good-faith beliefs – even if unreasonable – negate contempt.

Practical Implications for Employers

This ruling shields employers from contempt traps in vague settlements, particularly in medical incapacity matters under the Compensation for Occupational Injuries and Diseases Act. HR teams should audit dismissal paperwork – avoiding inadvertent ‘medical boarding’ labels on UI-19 forms – and insist on specialist reports before assisting employees with claims.

For labour law firms, it validates strategic appeals focusing on textual fidelity over contextual expansion, as seen in Capitec Bank Holdings v Coral Lagoon Investments. Forward-thinking practitioners can now advise clients confidently: Precision in settlement agreements averts costly litigation. Snyman Attorneys’ triumph demonstrates how expert navigation of LRA enforcement turns potential liabilities into precedents protecting business interests. Employers are empowered to defend reasonable positions without fear of punitive contempt findings.

Snyman Attorneys forms an integral part of Labournet’s national legal offering, operating as a specialised legal division within the group and working alongside Labournet’s established litigation and commercial teams.

Clients therefore benefit from seamless access to both the dedicated attorneys at Snyman Attorneys, including senior legal professionals such as Sean Snyman and the broader Snyman team, as well as Labournet’s expert, nationally supported litigation capacity. This integrated structure ensures that clients receive comprehensive, endtoend labour law support backed by the combined expertise of both entities.

T: +27 (0)31 266 6570

C: +27 (0)82 786 7480

E: johanvd@labournet.com

W: www.labournet.com

View eBook

NOT IN CONTEMPT OF COURT: VAGUE SETTLEMENT SAVES EMPLOYER FROM BAD-FAITH TRAP