Retirement Age Doesn't Mean the Risk Has Retired
- Grant Wilkinson
- Jul 14
- 5 min read
Updated: Jul 20
One of the most impactful South African employment law decisions in recent times is the Constitutional Court's judgment in Motor Industry Staff Association and Another v Great South Autobody CC t/a Great South Panelbeaters and Solidarity obo Strydom and Others v SITA (2024), which dealt with the dismissal of employees who continued working beyond their agreed retirement ages.
Why should employers care?
The consolidated cases of Motor Industry Staff Association and Another v Great South Autobody CC t/a Great South Panelbeaters and Solidarity obo Strydom and Others v State Information Technology Agency SOC Limited—decided by the Constitutional Court of South Africa in December 2024—dealt with a highly contentious and critical aspect of South African employment law: age-based dismissals and retirement.
Specifically, the Court had to interpret Section 187(1)(f) and Section 187(2)(b) of the Labour Relations Act (LRA). Under South African law, dismissing an employee based on age is considered an automatically unfair dismissal (unfair discrimination). However, Section 187(2)(b) provides an exception: a dismissal based on age is fair if the employee has reached the normal or agreed retirement age for persons in that capacity.
The core legal question across both cases was: Can an employer still fairly dismiss an employee based on age if they allowed the employee to continue working past their agreed or normal retirement age?
The Background of the Disputes
The MISA / Landman Matter:
An employee (Mr. Landman) had an agreed retirement age of 60 in his contract. He turned 60 and continued working for another nine months without any discussion about retirement. The employer then suddenly issued a termination notice based on him having reached his retirement age.
The Solidarity / SITA Matter:
Six employees surpassed their normal retirement age of 60 but were permitted to continue working. SITA's policies allowed employees to continue working until age 67 with the employer’s consent. SITA later dismissed them based on their age, but the union argued that SITA had implicitly or tacitly consented to a new retirement age of 67.
The Outcome and the Three Mutually Exclusive Interpretations
Because the Constitutional Court split and failed to reach a single majority consensus on how the statutory text should be applied, the judgment produced three distinct, split interpretations. This has created immense legal uncertainty for employers in South Africa:
The Strict Approach (Zondo CJ)
The Ruling: A dismissal based on age is only fair if it occurs on the exact date (or the last day of the specific month) the employee reaches their normal or agreed retirement age.
The Logic: Former Chief Justice Zondo argued that allowing employers an indefinite right to dismiss an employee anytime after retirement age leaves older workers incredibly vulnerable and open to abuse (such as an employer using age to mask an unfair performance or retrenchment dismissal). Dismissing them even a few months later is automatically unfair.
Application to the cases: Under this logic, both Landman and the SITA employees were unfairly dismissed.
The Reasonable Period / Election Approach (Van Zyl AJ)
The Ruling: An employer has a contractual "election" (a choice) to make when an employee hits retirement age. To be fair, the employer must exercise this right to dismiss within a reasonable period after the retirement date.
The Logic: If the employer waits too long without saying anything, they are deemed to have tacitly consented to the continuation of employment, waiving their immediate right to dismiss based on age.
The Flexible / Traditional Approach (Rogers J)
The Ruling: An employer retains the right to dismiss an employee based on age at any time after they have reached the agreed or normal retirement age.
The Logic: This interpretation aligned with historical South African case law (the Waco precedent). It views the retirement age as a permanent threshold—once crossed, the employer holds a continuous right to terminate the relationship, provided they give reasonable notice.
How the Specific Appeals Concluded
Despite the lack of an overarching majority reasoning, the judges aligned on the physical outcomes of the specific cases based on their unique facts:
The MISA (Landman) appeal was dismissed (his dismissal was ultimately held as fair under the facts by a majority of votes across the split judgments).
The Solidarity (SITA) appeal was upheld, and the employees were awarded 24 months’ remuneration in compensation. The court found that because SITA's policies actively contemplated extension up to age 67, letting them work past 60 constituted a tacit agreement to a new retirement age. Dismissing them before they hit 67 was therefore automatically unfair discrimination.
The practical employer risk
Where an employee remains employed beyond retirement age:
The employment relationship may continue on terms that create additional rights and expectations.
Delayed retirement decisions may expose employers to claims of unfair discrimination or automatically unfair dismissal.
Inconsistent practices across employees can create significant legal vulnerability.
Employers who do not actively manage retirement processes may find themselves litigating issues that could have been avoided through proper workforce planning.
Key Takeaway for Modern Workplace Culture
This ruling serves as a warning for South African employers. If an employee is nearing retirement age and the business wishes to retain them, they can no longer simply "let things slide" on a handshake. To protect both the dignity of the older worker and the legal safety of the organization, employers must formalize post-retirement employment via clear, written, fixed-term contracts rather than relying on open-ended arrangements.
My take-away for employers and HR
The real lesson is not about retirement age itself.
It is about consistency, planning and documentation.
Organisations should:
Clearly define normal and agreed retirement ages;
Monitor employees approaching retirement age;
Engage employees well before retirement;
Document any agreement to continue employment beyond retirement;
Ensure a consistent approach across the workforce.
Too often retirement is treated as an administrative issue. The Constitutional Court has reminded us that it is actually a strategic employment law risk that requires active management.
Final thought
Many employment law disputes arise not because employers make the wrong decision, but because they make the decision too late.
Retirement age is one such example.
The question HR leaders should be asking is: "Do we have a retirement management process, or are we simply hoping the issue resolves itself?"
This article is for informational purposes only and does not constitute legal advice. For specific legal guidance on protected disclosures, employment practices, or compliance obligations, consult a qualified labour law practitioner.
© 2026 Global Business Solutions (GBS). All rights reserved.
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