South African labour legislation is extensive and non-negotiable. Many employers do business honestly believing they comply with labour law, when in fact they do not. Non-compliance can have a serious financial impact, putting your business at unnecessary risk. The Department of Employment and Labour has the authority to enforce labour law and to conduct regular inspections of the workplace to ensure compliance. There are three types of labour inspections, each focusing on compliance with a different set of legislation, including the:
- Basic Conditions of Employment Act (including Sectoral Determinations and Main Collective Agreements);
- Employment Equity Act; and
- Occupational Health and Safety Act.
Employers should take note to differentiate between these types of inspections to ensure compliance as a whole. The three types of (separate) labour inspections address the following:
(1) Basic Conditions of Employment Act
This inspection focuses on compliance with the minimum terms and conditions of employment the employer and employee may agree on, including applicable industry specific legislation. The inspector will look at the following:
- Employment contract (written particulars of employment)
- Attendance register
- Information about remuneration – pay slips/envelopes, minimum wage, overtime, paid leave, working hours, etc.
- UIF and COIDA registration and proof of payments made
- List of all employees’ names and ID numbers
Non-compliance: the inspector will issue the employer with a compliance order (dated), after which a monetary penalty or imprisonment may be imposed.
(2) Employment Equity Act
This inspection focuses on compliance with the Employment Equity Act, which aims to eliminate unfair discrimination in the workplace and promote equal opportunity and fair treatment. “Designated employers” are employers who meet certain criteria and they have additional obligations. Employers must check whether they are classified as “designated employers” in order to ensure compliance.
Non-compliance: a “designated employer” can be fined for the first offence R1.5 million or 10% of the employer’s annual turnover (whichever is the greatest) and/or 10 years imprisonment.
(3) Occupational Health and Safety Act
This inspection focuses on compliance with health and safety regulations to ensure a safe and healthy workplace. The inspector will look at the legislative poster, health and safety representative and committee, applicable signage and personal protective equipment, etc.
Non-compliance: the inspector will issue the employer with a compliance order (dated) and/or temporarily shut down business activities, depending on the severity of non-compliance. Continuous non-compliance may result in penalties, imprisonment and possible criminal prosecution.
Many business owners are concerned about security due to people falsely posing as inspectors from the Department of Employment and Labour in order to gain access to the premises. During an inspection, it is vital to insist on positive identification of the person who introduces himself as an inspector, and to verify this information before giving the person access to your premises.
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