South African Employment Law

South African employment law is heavily employee-protective. The Labour Relations Act 66 of 1995 (LRA) and the Basic Conditions of Employment Act 75 of 1997 (BCEA) set the baseline — employers cannot contract below these minimums regardless of what the employment contract says.

Leo flags risk and drafts first versions. For dismissals, CCMA matters, and complex employment disputes, engage a labour attorney or registered labour consultant.

---

Employment Contract Essentials

Every employee must have a written contract. The BCEA requires a written notice of employment conditions within the first month of employment. A proper employment contract protects both parties.

Mandatory Clauses (BCEA Section 29)

• Full name and occupation of employee
• Place of work
• Start date
• Ordinary hours of work and days of the week
• Wage and rate of payment
• Leave entitlement
• Notice period

Additional Clauses That Protect the Business

• Confidentiality: All business information is confidential during and after employment
• IP assignment: Work created in the course of employment belongs to the employer
• Non-solicitation: Cannot solicit clients or employees for a defined period after leaving
• Garden leave: During notice period, employer may require employee not to attend work (prevents client poaching during transition)
• Restraint of trade: Limited geographic and time-bound restrictions on competitive activity

Note on restraints of trade: South African courts apply the "reasonableness" test — restraints must be reasonable in scope, geography, and duration to be enforceable. A 1-year restraint in a defined industry in South Africa is typically enforceable. A 5-year global restraint rarely is.

---

Basic Conditions of Employment (BCEA)

Working Hours

• Ordinary hours: 45 hours per week (9 hours/day for 5-day week; 8 hours/day for more than 5 days)
• Overtime: Maximum 10 hours/week at 1.5× the ordinary rate
• Sunday work: 2× the ordinary rate (or 1.5× if Sunday is an ordinary working day)
• Public holiday work: 2× the ordinary rate

Leave Entitlements

Leave Type	Minimum Entitlement
Annual leave	21 consecutive days (or 1 day per 17 days worked)
Sick leave	30 days over a 3-year cycle (1 day per 26 days in first 6 months)
Family responsibility leave	3 days per year (child sick, child born, death of family member)
Maternity leave	4 months unpaid; UIF maternity benefit applies
Parental leave	10 consecutive days (father or adoptive parent)
Adoption leave	10 weeks (for parent not on maternity leave)
Commissioning parent leave	10 weeks

Notice Periods (Minimum)

Length of Employment	Notice Period
Less than 6 months	1 week
6 months to 1 year	2 weeks
More than 1 year	4 weeks
Domestic workers (farm/household)	1 month

Notice may be paid out in lieu of working the notice period.

Termination Pay

• Severance pay (retrenchment only): 1 week's remuneration per completed year of service
• All outstanding leave must be paid out on termination
• Pro-rata bonus (if contractually entitled)

---

Contractor vs Employee

Misclassifying an employee as an independent contractor is one of the most common and costly employment law errors.

Section 200A of the LRA: A rebuttable presumption of employment exists where any of the following are present:

• The person works set hours or hours determined by the client
• The person has worked for the client for an average of 40 hours per month for 3 months
• The person forms an integral part of the business
• The person is economically dependent on the client
• The tools of the trade are provided by the client
• The person only works for one client

Consequences of misclassification: CCMA jurisdiction, unpaid leave claims, UIF arrears, SDL underpayment, and PAYE liability.

True independent contractor markers: Works for multiple clients simultaneously, uses own equipment, bears own risk, invoices VAT, operates a registered business entity.

---

Disciplinary Process

Before dismissing any employee (other than during probation for incapacity), a fair procedure must be followed:

Substantive Fairness

The reason for dismissal must be valid:

• Misconduct: Theft, dishonesty, insubordination, gross negligence, repeated lesser offences
• Incapacity: Poor performance (after counselling and opportunity to improve) or ill health
• Operational requirements: Retrenchment (fair process required — consultation, LIFO)

Procedural Fairness (Misconduct)

1. Investigation: Gather facts before charging
2. Notice of hearing: Written notice specifying the charges, date/time/place of hearing, right to union representative or fellow employee
3. Disciplinary hearing: Employee presents their case; employer presents evidence
4. Decision: Guilty / not guilty; if guilty, appropriate sanction
5. Sanction: Progressive discipline unless serious misconduct (gross misconduct may warrant summary dismissal on first offence)
6. Right of appeal: Employee must be given the right to appeal the outcome

Progressive discipline for minor offences:

1. Verbal warning (documented)
2. Written warning
3. Final written warning
4. Dismissal

Summary dismissal (no notice, no severance) is appropriate only for serious misconduct: theft, fraud, assault, gross dishonesty, wilful damage to property, gross insubordination.

---

Key Legislation Summary

Act	What It Covers
Labour Relations Act 66 of 1995	Unfair dismissal, unfair labour practices, trade unions, CCMA
Basic Conditions of Employment Act 75 of 1997	Minimum leave, hours, notice, pay on termination
Employment Equity Act 55 of 1998	Anti-discrimination, affirmative action (50+ employees)
Skills Development Act 97 of 1998	Learnerships, workplace training, SETA obligations
Occupational Health and Safety Act 85 of 1993	Workplace safety obligations
Compensation for Occupational Injuries and Diseases Act 130 of 1993 (COIDA)	Workers' compensation for injuries on duty