The South African labour market is rightly considered one of the most regulated in the world. Labour law sets strict requirements that employers must comply with. The most common laws that employers encounter on a daily basis include the following:

Labour Relations Act, Act 66 of 1995 as amended (LRA)

The LRA is one of the most important labour laws in South Africa. It regulates collective bargaining and provides protection against labour malpractices. This act also regulates trade unions and employers’ organisations and establishes key dispute resolution agencies such as the Commission for Conciliation, Mediation and Arbitration (CCMA), bargaining councils and labour courts.

This act further regulates all labour law processes that employers must comply with when it comes to the employer-employee relationship which, among other things, outlines the processes to bring the employment relationship to an end in a procedurally and substantively fair manner.

Basic Conditions of Employment Act, Act 75 of 1997 as amended (BCEA)

The minimum statutory requirements on which employers and employees may contract that are not regulated by other sectoral determinations or collective agreements, are determined and enforced by the BCEA. Any contractual stipulations that are inconsistent with this legislation are invalid.

National Minimum Wage Act, Act 9 of 2018 as amended (NMWA)

With effect from 1 January 2019, employers are required to pay at least the national minimum wage. This wage amount is promulgated from time to time by the Minister of Employment and Labour. Strict compliance with this legislation is enforced through regular labour inspections of employers. In certain industries, the minimum wage is regulated by the applicable collective agreement for that industry and the employer must comply with it.

Bargaining Council Main Collective Agreement (CA)

A CA concluded in a bargaining council binds the parties to the bargaining council who are also parties to the CA. The CA sets the minimum conditions of employment for those employers and employees. A bargaining council may request the Minister of Employment and Labour in writing to extend a CA to any outside parties that fall within its registered scope. Once a CA has been extended by the Minister to non-parties, such an employer who is not a party to the CA will be obliged to comply with the provisions of the CA and to register with the relevant bargaining council.

Sectoral Determinations (SD)

A SD regulates the terms and conditions of employment in a particular sector where there is no centralised collective bargaining and which requires detailed and specific regulations.  Conditions in a SD may differ from those in the BCEA, but will rank superior.

Employment Equity Act, Act 55 of 1998 as amended (EEA)

The primary goal of this Act is to eliminate unfair discrimination in all workplaces. This act also places additional obligations on designated employers (employers with 50 or more employees) to ensure that affirmative action measures are implemented.

Occupational Health and Safety Act, Act 85 of 1993 as amended (OHSA)

This act requires the employer to create a healthy and safe workplace for all persons in the workplace. The act also regulates the health and safety of persons in connection with the use of plant and machinery.

Compensation for Occupational Injuries and Diseases Act, Act 130 of 1993 as amended (COIDA)

COIDA provides for compensation for disability caused by occupational injuries or diseases sustained by employees in the course of their employment. Provision is further made for death resulting from such injuries or diseases, as well as for matters connected therewith.

Skills Development Act, Act 97 of 1998 as amended

The act aims to develop skills for the South African workforce by encouraging employers to promote skills development by using the workplace as an active learning environment and encouraging employees to participate in apprenticeships and other training programs. The act regulates standards for training and development by requiring employers (with an annual salary expenditure of more than R500 000.00) to contribute 1% of their payroll to the National Skills Fund.

Unemployment Insurance Act, Act 63 of 2001 as amended

The Unemployment Insurance Fund (“UIF”) provides relief to employees when they become unemployed as a result of dismissal or retrenchment, or are unable to work due to maternity leave, parental, adoption and commissioning parental leave, or prolonged illness. It also provides relief in some cases to the dependants of a deceased contributing employee. It is the employer’s responsibility to pay the contributions (2% of the employee’s salary), although both the employer and employee contribute 1%.

The obligations that labour law places on employers are non-negotiable and employers can be subject to serious fines, and even imprisonment, in cases of non-compliance. It is important that the employer is familiar with labour law and consistently follows the correct procedures with the necessary administrative support.

For more information on this and other labour laws that employers must comply with, contact our legal team for assistance.

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It happens that an employee is hired, but the employment contract is simply not signed. Employees are often under the mistaken impression that if the employment contract is not signed, he/she cannot be bound by the same rules and regulations as other employees who have signed the employment contract.

The employer-employee relationship is established when the employee and employer agree on terms of employment. The employee can therefore still be disciplined if the workplace rules and disciplinary code are violated, provided that the employer can prove that the rules existed, were reasonable, were consistently applied, the employee broke the rules and the employee had reasonable knowledge of the rules and regulations in the workplace.

What does the law say?

According to the Basic Conditions of Employment Act, Act 75 of 1997 as amended (BCEA), an employee must be notified in writing on the first day of employment of the details of the employment relationship. The BCEA also provides a detailed list of what must be included in this notice.

A written employment contract that is signed by both parties formalises the relationship and gives clarity to all parties. Without an employment contract, it can be difficult to prove that the employee agreed to certain terms such as shortened mealtimes, or even the period in cases of fixed-term employment contracts where the contract was only intended for a specific time/project.

Where do I start as an employer?

Resolve the situation by following these steps:

• Consult with the employee who does not want to sign the employment contract to explain the contract to him/her again and obtain reasons for the refusal;
• Give the employee a reasonable time to submit written reasons why he/she does not want to sign the contract, or to sign the contract if there is no reason not to sign it;
• If no reason/objection is given why the contract is not signed, the employer may request the employee to sign the contract again.
• If reasons can be provided, this can be discussed between the employee and employer.

The employer may take further steps to confirm the employment relationship and the rights of the employee concerned in terms of the BCEA by addressing a letter to the employee confirming the terms and conditions as prescribed in the BCEA. The employer will comply with the provisions of the BCEA if he provides the employee with a copy of the draft contract with a note that the employee has refused to sign it.

We always recommend that employers keep an attendance register and minutes for all consultations indicating that the employer followed a fair process and that the employee continued to work according to the terms of the contract, even if the contract was not signed. Should the employee verbally acknowledge his/her rights, an employment relationship is established and the person is then considered to be an employee.

Please note that an employer cannot simply dismiss an employee because he/she did not want to sign the employment contract. If an employer terminates the employment contract, whether concluded verbally or in writing, this may result in a referral of an unfair dismissal dispute to the Commission for Conciliation, Mediation and Arbitration (CCMA). The employee may then be entitled to reinstatement or compensation, even if they have not yet started working. However, if the correct processes are followed, the situation can easily be rectified and/or avoided.

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Chapter 2 of the Basic Conditions of Employment Act (BCEA) regulates working hours, including normal working hours and overtime. The maximum normal working hours allowed for employees earning less than the established income threshold amount in terms of section 9 of the BCEA is 45 hours per week. This means nine hours per day (excluding the lunch break) if the employee has a five day working week, and eight hours per day (excluding the lunch break) if the employee works more than five days per week.

This does not mean that the employee must necessarily work 45 hours per week. The number of normal working hours worked is a matter of contractual agreement between the employer and employee. Some employers work a 40 hour work week, and so on. The legal limit of 45 hours per week means that the employee may not work more than 45 hours per week of normal working hours. Lunch is unpaid time and is considered the employee’s own time, because they are not paid for lunch breaks.

As a result, an employee who works a five day workweek and receives a one hour lunch break per day will actually be at the workplace 50 hours per week (45 hours of normal working hours plus five hours for lunch breaks).

The lunch break must be given after five hours of continuous work. Under the BCEA, tea breaks will not qualify as a break in working hours. The legal lunch break is one hour, but can be shortened to 30 minutes by agreement between the employee and employer.

Overtime

The maximum permitted overtime is three hours on any day or 10 hours per week. Furthermore, the law states that an employer may not, under normal circumstances, allow/require an employee to work more than 12 hours on any day, including overtime. The law also establishes a minimum daily rest period of 12 continuous hours between shifts for employees who do not reside on the employer’s premises.

An employee who normally works nine hours a day and takes a one hour lunch break has already been at work for 10 hours and as such will not be able to work more than two hours of overtime per day, otherwise his shifts will be less than 12 hours apart.

Overtime is not mandatory and may only be worked per an agreement between the employer and employee. Please note that such an agreement is only valid for a period of 12 months and must be renewed annually. Failure to renew this agreement, or to enter into a new agreement, may result in employees being legally able to refuse to work overtime.

An employer must also give employees reasonable notice when they are going to be required to work overtime and as such may refuse to work overtime at short notice. However, an employee may not refuse to work overtime in terms of section 6(2) of the BCEA if the work to be done must be done immediately due to circumstances for which the employer could not reasonably have provided, and which cannot be done by employees during normal working hours.

Remuneration shall be at 1.5 (one and a half) times the employee’s normal rate of pay, except for work done on Sundays and public holidays. Any overtime worked on a Sunday shall be paid in accordance with the statutory provisions for Sundays and public holidays. Time off, calculated according to the same formula, may be given in lieu of pay, provided that this has been agreed to in writing with the employee.

This article is intended as general information for employers who fall under the scope of the Basic Conditions of Employment Act. To ensure that you as an employer are aware of the correct overtime applicable to your sector, or to obtain advice on this, contact the LWO on 086 110 1828.

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In the South African labour environment, the relationship between employers, employees and their representatives is regulated by the Labour Relations Act, Act 66 of 1995 as amended (LRA). This act provides for trade unions that are officially registered with the Department of Employment and Labour, to intervene in the employment relationship between employee and employer and, among other things, address workplace grievances and collective bargaining.

What about political parties?

The Labour Appeal Court confirmed in the case of CCI South Africa (Pty) Ltd vs African National Congress Youth League and Others (2024) 45 ILJ 969 (LAC) that political parties are only allowed to assist their members in an advisory capacity. However, they are not trade unions and cannot claim organisational rights in a workplace.

A Labour Court case, Calgan Lounge (Pty) Ltd vs. National Union of Furniture and Allied Workers of South Africa and Others [2018] JOL 40495 (LC), sheds light on the dangers of such interference.

The role of trade unions

Historically, trade unions have been essential for advancing workers’ rights. The LRA requires trade unions to be registered to ensure that they comply with strict regulatory requirements. This registration places trade unions under the supervision of the Registrar of Labour Relations, in order to ensure fair and transparent processes. The LRA also provides for workplace forums and employers’ organisations to resolve disputes, but political parties are expressly excluded from these structures.

Political interference and incitement to illegal activities

In the Calgan Lounge case, the Economic Freedom Fighters (EFF) involved themselves in a labour dispute at a logistics company. The EFF claimed that they had a mandate to act on behalf of the workers and handed over a memorandum of demands to the company’s CEO. According to the court, these demands, which were written on an EFF letterhead, resembled a political manifesto rather than legitimate workplace grievances. The company warned the EFF that their actions were inappropriate and that there were existing grievance procedures and trade union representation in the workplace. However, the workers, supported by the EFF, undertook a go-slow strike and later a full strike, which resulted in acts of intimidation, obstruction and blocking of the company’s premises and damage to property.

The company applied for an urgent interdict at the Labour Court to stop the strike, which was deemed unprotected because it did not comply with the requirements of the LRA. The court first issued an interim order against the EFF, declaring the strike illegal, ordering them to cease their illegal actions and to return to court in approximately two months to show cause why the interdict should be lifted.

Court proceedings resumed on the return date after which the court found that the EFF had no right to become involved in the dispute, as political parties have no place in LRA’s structures. By interfering, the EFF undermined the collective bargaining process, which ultimately resulted in the striking workers losing their jobs. The court confirmed the interdict against the EFF and the strikers, with costs.

Political parties belong outside the workplace

The Calgan Lounge case clearly shows the risks of political interference in workplace disputes. Political parties are not subject to the same regulations as trade unions and their actions can upset the delicate balance of collective bargaining. Employees can therefore only seek the advice of their political parties, but the political parties cannot negotiate labour matters on behalf of the employee/union.

Employers and employees must recognise the importance of established procedures and the role of registered trade unions. The LRA’s structures are designed to ensure order and fairness and the involvement of political parties can undermine these delicate processes.

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At the start of the employment relationship, even though the parties don’t know each other, a fiduciary duty is already in place that requires the employee to act in good faith and in the best interest of the employer.  It is important that the employer implements a written employment contract with each employee on the first day of employment – note that it can be argued that employment started during the interview process, as the employee has to be honest as to the qualifications and abilities the employee has.

A written employment contract creates clarity by confirming the terms and conditions of employment agreed upon and protects the employer in terms of the employment relationship going forward.  Take care to include a job description that specifies the employee’s duties and employer’s expectations.  The employee should also be aware of the consequences of not fulfilling these duties.

The employment relationship is a relationship of trust based on mutual benefits and respect.  As a business owner, the employer should always anticipate what can go wrong in the employment relationship, in order to mitigate risk and be best positioned going forward.  Poor work performance, conflict, misconduct, and a breach of trust can place this relationship in jeopardy and employers should take proactive steps to regulate the employment relationship and protect their rights. 

The following issues can cause a breakdown of trust in the employment relationship:

Conflict

The workplace is a very diverse environment in terms of culture, religion, beliefs, values, political views, frames of reference, work ethic, opinions, etc.  Everyone won’t always get along with each other and when conflict arises, the employer should step in and assist to resolve the conflict before it escalates, or starts to affect more employees and negatively impact on business operations.

Solution:  Have a consultation with the parties and assist to seek a solution best suited for all parties, to avoid further disturbances in the workplace.

Misconduct

Misconduct can be described as an employee’s failure to act according to the employer’s rules and policies, or failure to fulfil his/her duties.  In basic terms, misconduct is a behaviour issue of the employee. Such behaviour is normally deliberate or negligent, and employees can be held accountable for their actions. Misconduct can take various forms, including theft, fraud, dishonesty, insubordination, absence from work without permission, etc.

Solution:  Every workplace must have a relevant disciplinary code and employees must be aware of it.  Be sure to keep an attendance register and minutes of the meeting when discussing the disciplinary code with the employees. The disciplinary code is essential in ensuring that there are clear rules in the workplace, with appropriate sanctions, that employees can follow. When these rules are violated, the employer can apply progressive discipline, or in cases of serious misconduct proceed directly with a disciplinary hearing.  It is vital to always follow the correct procedure, as in failing to do so can lead to dire consequences with a huge financial impact.  If there is a possibility of dismissal, a disciplinary hearing must be held prior to dismissing an employee. The employee should be given an opportunity to state their case during a fair disciplinary process. If the misconduct has led to the irreparable breakdown of the trust relationship, the employment relationship may be terminated.

Poor work performance

Poor work performance refers to an employee’s incapacity when an employee fails to reach and maintain the employer’s work performance standards in terms of quality and quantity.  All employment contracts imply that the employee undertakes to perform according to the reasonable, lawful and attainable work performance standards set by the employer. Should the employee fail in this duty, despite assistance to reach the required standard, the employee is said to be incapable and the employer has the right to dismiss him/her subject to following the correct procedure.

Solution:  Poor work performance involves a consultation process where the employee is informed of shortcomings and provided with training and guidance to achieve the desired outcome.  The employee is then monitored for a reasonable period of time and offered further training and guidance as needed.  Assess the employee’s improvement during a follow up consultation.  If the employee does not improve sufficiently, a formal disciplinary process can follow which can lead to dismissal.

It is important to maintain good and healthy working relationships. Boundaries should be set from the beginning of the employment relationship to avoid any uncertainties going forward. Keep the communication lines open for all parties to address any issues which may arise. Employers should take care to follow the correct procedures when taking disciplinary action or holding consultations.  Be sure to keep an attendance register and minutes of the consultations with the employee.

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What is a policy?

A policy informs employees of the rule/s in respect of a certain topic. The employer puts these rules in place in order to ensure the smooth and efficient running of his/her business operations. Policies are not underwritten by labour legislation, but define the employer’s own rules, which must be reasonable, for the workplace. We strongly advise employers to implement the following policies in the workplace:

Code of conduct

Smoking policy

Sick leave policy