By Teboho Mokoena

Imagine this scenario: You are a bank branch manager. Your branch is not doing all that too well, in fact, it is experiencing an economic downturn. Among others, as a result of this, several accounts have had to be deemed inactive. Realising this, as well as the implications thereof, you take a decision to deposit R100 into 10 such inactive accounts. The net result of your actions is that the accounts are now deemed Active, and consequently constitute sales in terms of the branch’s performance. Against set performance targets, your branch’s performance now looks better than it would have, had you not intervened.
The question is: Was your intervention as a branch manager justified, legally, morally or ethically?
Felicity Austin-Day was employed by Absa as a branch manager at its branch, at 6 Avenue, Walmer Park, in Gqeberha. Felicity had been in the employ of the bank for 33 years with an unblemished record.
She had also worked as a branch manager, in various branches of the bank, for a period of 15 years, preceding her dismissal. According to the court records, during her employment as the branch manager at the aforementioned branch, Felicity decided to deposit R100 of her own money into 10 inactive accounts, opened by 10 different customers, which were under her control at her branch.
An amount of R10 was deposited in each of those accounts. The deposits were made without the knowledge and/or consent of the holders of those accounts. The effect of such deposits was that those accounts, which were inactive, were then recorded as activated accounts in the branch’s books, and as such, constituted sales in terms of the branch’s performance. By way of background, the type of accounts that Felicity deposited money are said to be as Transact Accounts “which are said, to basically be transactional accounts aimed at individuals who are either unemployed, or irregularly employed, and who would make deposits of around R2,000, or less, in any given month, into their respective accounts. Thus, the accounts are used predominantly by customers falling within the low-income group”. These types of accounts generally tended to be operational only once a deposit had been made. Otherwise, they remained inactive if there was no deposit that was made into the account after a period of four months.
It was a given nature of the account that no minimum opening balances and no minimum daily balance were required. And as a means of further cutting costs, customers did not automatically receive monthly statements in respect of such accounts. It was a generally accepted practice that for this particular bank, sales targets were recorded when a newly opened accounts were activated. Although accounts were opened when sales were registered, each specific account only became activated once customers made a deposit into the account and started transacting. Once an account was activated, it then started attracting costs in the form of a cash deposit fee, together with administrative fees. It is at that time that the bank would be able to make a return, based on the fee charges generated for the transactions that take place.
Felicity voluntarily informed the area manager about the deposits in question. Subsequently, further investigations into the policy and procedures of the bank were undertaken by the operations representative who recommended disciplinary action against Felicity. She was charged with two counts of alleged misconduct.

Count 1: “It is alleged that you acted dishonestly, in the execution of your duties as a branch manager of ABSA, 6th Avenue, Walmer Park, when you made irregular cash deposits into customer accounts.
Count 2: “It is alleged that you failed to adhere to the group’s laid down policies and procedures in the executions of your duties as a branch manager.”
Following a disciplinary enquiry, Felicity was found guilty and dismissed, based on the grounds of dishonesty. She lodged a dispute with the CCMA, citing the fact that she had not been found guilty for the offence she had been dismissed for. She didn’t challenge the procedural fairness of her dismissal.
The bone of contention was whether Felicity had acted dishonestly when she deposited the said amounts into the customers’ accounts and whether in so doing, she had contravened any policies of the bank and applicable legislation.
The CCMA found that Felicity, while having been dismissed in a procedurally fair manner, the same could not be said in respect of substantive fairness.
It ruled that she be reinstated on terms and conditions no less favourable to her than those that governed the employment relationship immediately prior to her dismissal.
The bank was aggrieved by the findings of the CCMA and launched a review application.
The Labour Court (LC) reviewed and set aside the arbitration award. The LC reasoned that the CCMA ignored the material evidence before it, and consequently failed to arrive at a decision that a reasonable person would have arrived at; i.e., that Felicity was dishonest.
She then referred the matter to the Labour Appeal Court (LAC). Again, the issue that had to be decided upon was whether Felicity had acted dishonestly.
The LAC, in arriving at its decision reasoned that:

  1. Felicity’s performance already stood at 103% on year-to-year basis. At best she stood to boost that figure to 105%. Therefore, she was not in trouble as suggested by the bank, as far as her performance was concerned.
  2. Secondly, there was nothing on record which indicated that Felicity stood to gain any kind of reward on account of adding 10 accounts. There was no performance bonus or other kind of incentive that was within reach at the time that could be achieved by the artificial addition of the 10 savings account.
  3. The LAC further held that Felicity thought this was a good way of trying to motivate the account holders to use the accounts.
  4. Felicity left, freely so, a paper trail in respect of the deposits by entering her name and identity number on the deposit slips. She had an alternative means of depositing the amounts anonymously at the ATM, but she opted not to do so. She could still have entered a 13 false name and identity number on the deposit slips, this also she did not do.
  5. The LAC further found that there was undisputed evidence that Felicity wanted to motivate her staff. She acted openly and to the knowledge of the staff at the branch.
  6. The LAC further acknowledged that while Felicity had accepted that she had acted rather stupidly, and without lack of judgment, this could not come to the assistance of the bank in any way.
  7. There was no specific clause of any specific policy and procedure that could be convincingly pointed out that was breached.
  8. There was no evidence that she acted in bad faith or that by her actions, she exposed the bank to any material risk. Importantly, the LAC pointed out that out of the 10 accounts, while the nine remained largely dormant, the owner of the 10th account, started operating on the account. The LAC held that the bank should have informed this person that their account have been illegally accessed. The bank did not inform the account holder, instead, it happily enjoyed the benefit of what it considered to be “dishonest conduct”.
  9. The bank’s own forensics team found no evidence of fraudulent conduct on the part of Felicity. Instead, they merely recommended remedial action after they had concluded their own investigation.
  10. The LAC also took into account Felicity’s unblemished record of 33 years of service, which it felt, militated against the sanction of dismissal.
  11. There is nothing on record that indicates that the appellant stood to gain any kind of reward on account of adding ten accounts. There was no performance bonus or other kind of incentive that was within reach at the time that could be achieved by the artificial addition of the 10 savings accounts.
  12. There was no evidence that the appellant acted in bad faith or that by her actions, she exposed the bank to any material risk.
  13. If there was any misconduct, it was not serious enough to warrant dismissal. The evidence on record was that when the forensics learnt about this unfortunate incident, they did not give an indication that this was a serious transgression. It must have not been serious, for if it was so, forensics would have immediately indicated as such to the appellant, and besides, forensics found no evidence of fraudulent conduct on the part of the appellant. It merely recommended remedial action after its investigation.
  14. There was hardly any evidence on record of any prejudice suffered either by the bank or by the customers whose bank accounts were used. The prejudice contended by the bank’s counsel that the appellant’s conduct would open the bank to money laundering activities was without merit. Thus, the LAC held that the allegations of money laundering were outrageous and farfetched;
  15. Lastly, the LAC further held that the allegation by the bank that the customers whose accounts were accessed without their knowledge, would be prejudiced by the bank charges which would be accumulated was also without merit.
    The LAC came to this conclusion on the basis that even if the accounts would attract bank charges, the said amounts would usually be written off after a period of time.
    What this case proves is that upon closer inspection things may be different than what was initially thought.

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