Labour Law and Employment Contracts in South Africa

Labour law in South Africa grew a lot from the original Industrial Conciliation Act of the early 1900s and became one of the first areas of law to undergo major changes after the 1994 election. The Labour Relations Act of 1995 marked a monumental moment in labour history. It was amended in 2002 to address the evolving employment relations in the country.

In addition to the Labour Relations Act, the Occupational Health & Safety Act of 1992, Compensation for Occupational Injuries & Diseases Act of 1993, Employment Equity Act of 1998, Basic Conditions of Employment Act of 1997 (BCEA) and the amended Basic Conditions of Employment Act of 2002, in addition to the Skills Development Act of 1998, and Unemployment Insurance Act of 2001 govern labour law in South Africa. Furthermore, South Africa’s labour law has several sources, including legislation, common law, collective agreements and judicial precedent, as well as legal reports.

The acts mentioned above encompass employees working in and out of South Africa and are applicable to all employees in the country, regardless of their nationalities or the nationalities of the employers. These acts covering labour law in South Africa are reinforced by the NEDLAC Statutory Codes of Practice and may also be supported by other codes of practice. Though the codes of practice are indirectly legally binding, should there be a row in a specific industry between an employer and employee/s, the Court will review and consider the codes of practice. Mutual agreements are enforceable to guarantee that negotiations between organised labour and employers can be binding.

The Importance of Employment Contracts in South Africa

The employment contract forms a fundamental part of labour law in South Africa. Though a written contract of employment is recommended, it is unnecessary for a valid employment relationship to be existent. It is, however, important to keep in mind that the BCEA makes it necessary for the employer to give the employee written particulars upon commencing employment to create confidence in the employment relationship and to guard the employee against exploitation. As such, the employment contract should be created early on as it will not only protect the employee, but ensure that the employee understands the employer’s disciplinary rules. The employment contract binds both parties legally and should include details regarding the start of employment, termination of employment and payment characteristics.

The BCEA outlines the written details that should be included in such a contract as follows:

  • Employer’s name and address.
  • Full name of the employee.
  • Employee occupation and job description
  • Place of work.
  • The date on which the employment starts.

The contract should also specify particulars regarding the regular work hours and days, along with the wage and how it is calculated, overtime rates, and any other payments relevant to the employment relationship. It is necessary to specify the date upon which wage payment can be expected, any deductions from the earnings, number of leave days to which the employee is allowed and the type of leave, termination notice period, bargaining council codes monitoring the relationship, and documents forming part of the employment agreement.

There are basically fixed term and indefinite term employment contracts. The first refers to employment agreements where the duration of employment is clearly stated and termination of the agreement cannot be made during the employment period, unless there is a valid and legally allowable reason. The latter refers to an employment contract where the ending date of the contract is not stipulated. The agreement is in place until it is terminated by means of reasonable notice from one of the parties – if one of the parties dies, the employer becomes bankrupt, employee retires, or one of the parties choose to end the agreement because of a fundamental breach in the agreement.

Brian Blignaut Attorneys is a law firm dedicated to professional legal services of the highest calibre. It is not a matter of being more gifted than others but rather the goal-oriented solution seeking attitude of our staff that allows our clients to entrust us with any obstacle. Brian Blignaut Attorneys can assist clients with extensive labour law practices in that we specialise in providing assistance to employers in respect of the following:

  • Disciplinary codes and conducts
  • Drafting company policies and procedures
  • Drafting disciplinary documentation
  • Procedures of informal inquiries, disciplinary actions and dismissals

BBA is also able to assist employees in their disciplinary hearings, should third party assistance be required.

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