Most employers can recognise misconduct when they see it, and most can identify poor performance. What is harder is the employee who is not doing anything you can charge, whose technical output is adequate, but whose behaviour has broken the working relationship. Under the 2025 Code of Good Practice, that is not a case for a disciplinary hearing. It is a case for an incompatibility process, and the rules governing an incompatibility dismissal in South Africa are stricter than most employers expect.
The 2025 Code of Good Practice: Dismissal took effect on 4 September 2025 as Schedule 8 to the Labour Relations Act 66 of 1995. It is the first Code to expressly recognise incompatibility as a form of incapacity. That single change gives employers a clearer statutory footing for an incompatibility dismissal in South Africa, but it does not lower the fairness threshold. A fair incompatibility dismissal in South Africa is substantively and procedurally onerous, and the CCMA is likely to test it carefully.
This article explains what the Code permits, what it does not, how to run a defensible incompatibility dismissal in South Africa, and how to recognise the point at which the matter is better resolved by mutual separation than by dismissal at all.
What Item 21(7) of the 2025 Code Actually Says About Incompatibility
Incompatibility sits in Part F of the 2025 Code of Good Practice, which deals with incapacity. Item 21(7) provides that an employee’s incompatibility, as manifested by an inability to work in harmony with an employer’s business culture or with fellow employees, can constitute a form of incapacity which may justify dismissal. The provision is short, but each element matters, and each element shapes what an incompatibility dismissal in South Africa must look like on the facts.
First, incompatibility is treated as a form of incapacity, not as misconduct. That classification decides everything that follows. An incapacity route is investigative and remedial in the first instance, not disciplinary. Counselling, guidance and a reasonable opportunity to change are the default posture. A charge sheet and a disciplinary hearing are not.
Second, the test is objective. The Code speaks of an inability to work in harmony with the business culture or with fellow employees. That is a factual test about the working relationship, not a preference test about whether managers or colleagues like the employee. An incompatibility dismissal in South Africa cannot rest on subjective dislike.
Third, the Code says incompatibility may justify dismissal. It does not say it will. Fairness under section 188 of the Labour Relations Act still requires a fair reason and a fair procedure, and any decision-maker is required to take the 2025 Code of Good Practice into account when deciding whether both were met.
Incompatibility, Misconduct, Poor Performance and Operational Requirements: The Classification That Decides the Case
The single biggest error employers make when facing a difficult employee is choosing the wrong route. The 2025 Code recognises four distinct grounds for dismissal, and each carries a different process.
- Misconduct (Part D) is a deliberate breach of a workplace rule or standard. It is addressed through a disciplinary process.
- Poor performance (Part F, items 19 and 20) is an inability to meet an objective performance standard. It is addressed through counselling, training and a reasonable period to improve.
- Incompatibility (Part F, item 21(7)) is neither of the above. The employee is capable of doing the job and has not broken a rule, but the working relationship has become objectively unworkable. That is the space an incompatibility dismissal in South Africa occupies.
- Operational requirements (Part G) relate to the employer’s economic, technological, structural or similar needs. That is retrenchment territory, and the process under section 189 is entirely different.
Classification is not an academic exercise. Choosing the wrong route is one of the most common bases on which a dismissal is successfully attacked at the CCMA. A dismissal for interpersonal conflict that was really a disciplinary matter, or a poor-performance dismissal that was really an incompatibility case, is likely to be found substantively or procedurally unfair, regardless of how careful the paperwork looks. The reverse is equally true. Running a genuine misconduct case as an incompatibility dismissal in South Africa dilutes the employer’s own evidence and often produces a worse outcome than a straightforward disciplinary hearing would have.
Worked example. A senior manager alienates colleagues through abrasive communication and an unwillingness to collaborate. Performance targets are met. No workplace rule has been broken. Counselling and coaching have not moved the position. That is not a disciplinary case, and it is not a poor-performance case. It is an incompatibility case, and it must be run as one.
Book a labour law consultation with Leigh-Ann Govender before you decide which route to run. Choosing between misconduct, incapacity, incompatibility, operational requirements and a mutual separation discussion is the classification that decides whether an incompatibility dismissal in South Africa survives at the CCMA.
The Substantive Threshold: What Is Enough, and What Is Not
The Code sets an objective threshold. The employer must be able to show, on objective evidence, that the employment relationship has become untenable despite reasonable efforts to resolve the position. That is a high bar for any incompatibility dismissal in South Africa, and it is deliberately so.
What is likely to meet the threshold:
- Persistent, documented interpersonal breakdown between the employee and colleagues, managers or clients that survives counselling and coaching.
- Senior or leadership conduct whose effect on team cohesion is objectively demonstrable, not merely reported as disliked.
- A values or working-style mismatch following a merger or restructure that has produced measurable operational consequences.
- Conduct that has damaged a client relationship or the employer’s reputation in a way that can be evidenced, not merely asserted.
What is not enough:
- Colleagues dislike the employee.
- A single manager finds the employee difficult.
- A personality clash without evidence of operational effect.
- Discomfort with an employee’s religion, culture, political view, language, or associational choices.
That last category is not merely a fairness concern. It is an automatically unfair dismissal risk. A cultural misfit dismissal that is really a proxy for religion, culture, political belief, protected disclosure, pregnancy or union activity is automatically unfair under the Labour Relations Act. The 2025 Code does not soften that perimeter. If the underlying issue is a protected characteristic, an incompatibility dismissal in South Africa is the wrong instrument, and the employer’s obligations sit under anti-discrimination legislation, not under item 21(7).
Incompatibility Dismissal in South Africa: What a Defensible Process Looks Like
Section 188 of the Labour Relations Act requires substantive and procedural fairness. Read with Part F of the 2025 Code, a defensible process for dismissing an employee for incompatibility ordinarily runs through the following steps. Each step matters, and each step must appear on the record. An incompatibility dismissal in South Africa that is reconstructed after the fact is almost always unfair.
- Identify and record the concern. Set out, in writing, what specifically is not working and why. Vague characterisations such as “not a team player” are not enough. The concern must be capable of being tested against evidence.
- Consult with the employee. Present the concern, hear the employee’s response, and consider it genuinely. Consultation is not a formality. In an incompatibility dismissal in South Africa, the consultation record is often the first place a CCMA arbitrator looks.
- Counsel and support. Provide feedback, guidance, and where appropriate, coaching or mediation. Document each session. Where the employer has structured support in place, an incompatibility dismissal in South Africa is materially easier to defend.
- Give a reasonable opportunity to change. The employee must have a genuine chance to address the position. What is reasonable depends on the nature of the incompatibility, the seniority of the employee and the operational context.
- Consider alternatives to dismissal. Reassignment, restructuring the reporting line, a change of team, or a formal facilitation may be reasonable in some cases. The record must show alternatives were considered, not merely referenced.
- Only then consider dismissal. Dismissal is a measure of last resort. If the relationship has genuinely become untenable despite the steps above, an incompatibility dismissal in South Africa may be considered, subject to the employee’s right to state a case in response.
There is no prescribed timeframe. In most matters the process is likely to take several weeks. Senior or complex cases may take longer. Rushing the process is one of the most common reasons an incompatibility dismissal in South Africa fails at the CCMA. A short paper trail signals a pre-formed decision.
Why Employers Get Incompatibility Dismissals Wrong
Even well-advised employers get an incompatibility dismissal in South Africa wrong when they treat the process as a formality rather than a genuine incapacity enquiry. Four errors recur.
The first is confusion between misconduct and incapacity. The employer’s frustration is often expressed in the language of blame (“she is refusing to collaborate”) rather than the language of incapacity (“she is unable to sustain a working relationship despite reasonable support”). Once the employer’s own documents describe the matter as misconduct, an incompatibility dismissal in South Africa becomes much harder to defend, because the employer’s own record contradicts its chosen route.
The second is a substitute for a difficult performance conversation. Where an employee’s performance is genuinely below standard but the manager has not been willing to run a poor-performance process, incompatibility is sometimes used as a workaround. That workaround does not survive scrutiny. An incompatibility dismissal in South Africa cannot be used to sidestep the counselling, standards and improvement obligations that Part F attaches to poor performance.
The third is over-reliance on complaints from colleagues. Colleague complaints are relevant, but they are not, on their own, evidence of an objective breakdown. In an incompatibility dismissal in South Africa the employer must show the effect of the conduct on the working relationship, not merely that other people have raised concerns. The distinction matters because a CCMA arbitrator is likely to test whether the employer relied on unverified complaint traffic or on genuine investigation.
The fourth is treating consultation as a hearing. An incompatibility process is a conversation, or a series of conversations, in which the employer sets out the concern, listens, adjusts if appropriate, and only then decides. Employers who script the meetings as though they were disciplinary hearings often produce a record that reads as adversarial rather than remedial, and an incompatibility dismissal in South Africa that follows an adversarial record is exposed on procedural fairness.
Evidence Employers Should Preserve
The evidence must show both that the incompatibility exists on objective facts and that a fair process was followed. In an incompatibility dismissal in South Africa the record is the case. Employers should preserve:
- written concerns, grievances or complaints from colleagues, managers or clients;
- incident records with dates, participants and observable behaviour;
- minutes of consultation and counselling sessions, signed where possible;
- feedback letters and any improvement plan;
- records of alternatives considered and why they were not viable;
- correspondence with the employee at each stage;
- the employee’s written responses at each stage.
Subjective opinion is the weakest form of evidence and is one of the most common bases on which an incompatibility dismissal in South Africa is successfully attacked. The record must speak for itself.
When Incompatibility Should Become a Mutual Separation Discussion Instead
There is no obligation to attempt a mutual separation. In many cases, however, the parties recognise before the incapacity process runs its course that the relationship has broken down beyond reasonable repair and neither side wants a dismissal on the record. In those cases, a without-prejudice mutual separation discussion may be appropriate, and it is often a better outcome for both sides than an incompatibility dismissal in South Africa that will be defended at the CCMA.
The pivot must be handled carefully. Two rules matter most.
First, the discussion must be genuinely without prejudice and voluntary. The employee must be free to refuse. An offer that is presented as the alternative to inevitable dismissal is not voluntary, and any agreement that follows may be attacked as procured under duress.
Second, if no agreement is reached, the incapacity process continues fairly. The employer must not treat the employee’s refusal to separate as evidence supporting dismissal. That contamination is one of the most common reasons a subsequent incompatibility dismissal in South Africa is found unfair. The two processes must be kept structurally separate.
For the mechanics of that route, see our article on Mutual Separation Agreements Under South Africa’s New Code of Good Practice. For the risks of a poorly documented settlement, see Are Mutual Separation Agreements Enforceable? (Workforce Staffing v Mjoli).
Not every incompatibility case ends in dismissal, and not every case suits a mutual separation. Book a consultation with Leigh-Ann Govender to assess which route the facts actually support before you commit to either one.
What Happens if the Matter Reaches the CCMA
Where the employee refers an unfair dismissal dispute after an incompatibility dismissal in South Africa, the matter typically proceeds first to conciliation and then, if unresolved, to arbitration. The commissioner’s task is to consider whether the reason for dismissal was fair and whether the procedure was fair, with reference to the 2025 Code of Good Practice.
Three aspects of the enquiry deserve attention.
The commissioner will scrutinise classification. The first line of attack on an incompatibility dismissal in South Africa is often that the matter was really a misconduct case or a poor-performance case in disguise. The employer must be able to explain, on the evidence, why the case was properly characterised as incapacity under item 21(7) and not as one of the other Part D or Part F grounds.
The commissioner will scrutinise the process. A defensible incompatibility dismissal in South Africa is one where each step of the process appears in the record, in sequence, with dates. Where the record shows an accelerated process or a single confrontational meeting followed by dismissal, the procedural fairness enquiry tends to go against the employer.
The commissioner will scrutinise alternatives. The employer must show that reasonable alternatives were considered, not merely mentioned. In practice, this means demonstrating that reassignment, restructuring or facilitation were assessed against the specific facts and rejected for good reason. Where the alternatives analysis is a paragraph in a letter rather than a documented enquiry, the substantive fairness of the dismissal is exposed.
Remedies for an unfair dismissal include reinstatement, re-employment or compensation of up to twelve months’ remuneration. Which remedy applies depends on the facts, the employee’s preference, and the practicality of restoring the employment relationship after an incompatibility finding.
Common Mistakes That Cause Incompatibility Dismissals to Fail at the CCMA
The pattern is consistent. Dismissing an employee for incompatibility tends to fail when one or more of the following is present in the record:
- reliance on subjective opinion rather than objective evidence;
- failure to counsel the employee, or counselling that was pro-forma;
- no reasonable opportunity to change;
- alternatives to dismissal not considered, or considered only on paper;
- the case is really about misconduct or poor performance and should have been run as such;
- the case is really about a protected characteristic and should not have been run as incompatibility at all;
- the process was rushed;
- documents were drafted after the fact.
Each of these is avoidable. None is cured after the referral.
When to Get Attorneys Involved
The right time to obtain legal advice on an incompatibility matter is before the first counselling session, not after the referral to the CCMA. The classification decision, the design of the process, the choice of evidence to record, and the framing of any without-prejudice discussion all shape whether a subsequent incompatibility dismissal in South Africa is defensible. Retrofitting a fair process is not possible.
Vermeulen Attorneys assists employers to classify the matter, design the process, draft the counselling records and warning letters, and advise on the pivot to a mutual separation where the facts support it. Where a matter has already been referred to the CCMA, we appear on behalf of the employer at conciliation and arbitration.
Frequently Asked Questions
Can I dismiss an employee just because they do not fit our culture?
No. A cultural misfit dismissal based on preference rather than objective breakdown is likely to fail at the CCMA. Item 21(7) of the 2025 Code requires an objective inability to work in harmony with the business culture or with fellow employees, demonstrated on evidence, after counselling and a reasonable opportunity to change. Personality preference is not enough, and using “culture” as a proxy for religion, political belief or any other protected characteristic is likely to be automatically unfair.
Do I need to give warnings before dismissing for incompatibility?
Formal disciplinary warnings are used for misconduct, not incapacity. In an incompatibility matter the employer must instead provide counselling, feedback, a reasonable opportunity to change, and consideration of alternatives to dismissal. The employee must know what is not working, why it matters, and what change is expected. Whether that is documented as a warning or as a counselling letter matters less than whether the substance is present in the record.
Is an incompatibility dismissal a retrenchment?
No. Retrenchment is a dismissal based on the employer’s operational requirements under Part G of the 2025 Code and section 189 of the Labour Relations Act. Incompatibility sits in Part F as a form of incapacity. The two processes are procedurally different, and misclassifying the matter one way or the other is a common route to an unfair dismissal finding.
How long should an incompatibility dismissal in South Africa take?
There is no prescribed period for an incompatibility dismissal in South Africa. In most matters the process is likely to take several weeks, and senior or complex cases may take longer. What matters is whether the employee had a genuine opportunity to address the position and whether the employer genuinely considered alternatives. A process that is too short signals a pre-formed decision and is often the reason a subsequent dismissal fails at the CCMA.
Can I use incompatibility to remove a difficult senior employee?
Sometimes, but not on the basis that the person is difficult. A dismissal for interpersonal conflict at senior level requires the same objective evidence as at any other level, together with a properly documented process. Seniority does not lower the threshold. In practice, senior matters are often better resolved through a properly structured mutual separation once the incapacity process has established that the relationship cannot be repaired.
When does an incompatibility case become a mutual separation case?
When it becomes clear on the facts that the relationship is not going to be restored and both parties prefer a negotiated exit to a contested dismissal. The mutual separation discussion must be genuinely without prejudice, voluntary, and structurally separated from the ongoing incapacity process. If no agreement is reached, the incapacity process must continue fairly, and the employee’s refusal to separate must not be treated as evidence supporting dismissal.
What evidence is most important in an incompatibility dismissal in South Africa?
Objective, contemporaneous evidence. Incident records with dates and observable behaviour, minutes of counselling sessions signed by both parties, feedback letters and improvement plans, records of alternatives considered, and the employee’s written responses at each stage. Subjective opinion, complaint traffic and reconstructed timelines are the weakest form of evidence and are often the reason a CCMA arbitrator finds an incompatibility dismissal in South Africa unfair.
What compensation can be awarded if the CCMA finds the dismissal unfair?
The Labour Relations Act permits reinstatement, re-employment or compensation of up to twelve months’ remuneration for an ordinary unfair dismissal. Compensation may be higher where the dismissal is found to be automatically unfair. Which remedy applies depends on the facts, the employee’s preference, and whether the working relationship is capable of being restored. The available remedy in any particular incompatibility dismissal in South Africa depends on the evidence and the procedural posture.
Speak to Leigh-Ann Govender Before Initiating an Incompatibility Process
Choosing the wrong route is the single biggest reason an incompatibility dismissal in South Africa fails at the CCMA. Before you counsel, warn, or open a without-prejudice discussion, book a labour law consultation with Leigh-Ann Govender to assess the facts, choose the correct route, and design a process that will hold up under scrutiny. Contact Vermeulen Attorneys to arrange a consultation.
