Answers

Do I need to have employment contracts for my employees?

Yes, if your employees work more than 24 hours in month you should have contracts of employment or at least formal written letters to provide specific information in writing and to record important agreements.

Your contracts of employment should accurately reflect the relationship with your employees. To ensure that you have company specific contracts that are tailored to your business contact us: admin@employmentrelations.co.za

What if I do not have employment contracts for my employees?

Here are a few things that can happen:

The Department of Labour can issue you with a compliance order to give your employees specific information in writing (BCEA Section 29). Except if your employees work less than 24 hours in a month.
The provisions of the Basic Conditions of Employment Act and all other relevant legislation automatically become part of the terms and conditions of employment (referred to as implied terms). This will happen irrespective of whether you have a written contract of employment, but the difference with a contract is you can apply the legislation appropriately to suit your business context.
When there is a dispute about an agreement between the employer and the employee, the outcome can be negative for either party, or both. This is because the agreement will be determined based on the behaviours of the parties (referred to as tacit terms), which when assessed by a third party, may not accurately reflect the agreement.
Ambiguity. If the parties lack clarity, it could cause differing expectations which may result in unnecessary conflict between the parties.
There are specific provisions in the BCEA that require a written agreement between the parties. Without this agreement, the specific terms and conditions cannot be enforced and could be costly. E.g. Reducing an employee’s lunch time to 30 mins or not having lunch on days when an employee works less than 6 hours (see BCEA Section 14).
A fixed-term contract of employment must be in writing. This means that should the employer terminate the relationship with the employee, without a written fixed term contract that specifies the termination date and the reason for the fixed term contract (see LRA Section 198B for justifiable reasons for a fixed term contract), it will constitute as an unfair dismissal. This is not applicable to employees earning in excess of the earnings threshold (currently R205 433.30 per year CTC).

Can I use fixed term contracts for a probation period?

Generally, no, but there are exceptions. A fixed-term contract should be used for work that is of a specific duration (e.g. a specific project) or if an employer can provide another justifiable reason (see Section 198B for a list). The list includes examples such as seasonal work, replacing someone who is on leave, etc.

The only exception to the above is:

If the employee earns in excess of the earning threshold (currently R205 433.30 per year CTC);
The employer employs less than 10 people; or
The employer employs less than 50 people, but the business has been in operation for less than 2 years.

If you do not fall within one of the exceptions listed above and you do use fixed-term contracts for the probationary period, it may be seen as an unfair dismissal.

If the CCMA finds that a fixed-term contract was not used correctly or for a justifiable reason, the employee will be seen as a permanent employee. To ensure that your fixed term contracts are compliant contact us: admin@employmentrelations.co.za.

During a probation period an employer is required to provide evaluation sessions, training and other assistance. We can teach your managers how to manage performance during (and after the probation period) or we can assist you with the procedure to ensure that your company follows the guidelines as set out in the Labour Relations Act (Schedule 8).

If it says so in the contract, can I do it?

Not necessarily. If your contract has a clause that is contrary to the legislation and you implement it, it will still be unfair even though it is in the contract. The reason: two parties cannot agree to something that is against the legislation.

Here are examples:

If an employee terminates their employment without giving notice you cannot deduct the notice period amount from their last payment, even if it says so in the contract.
An employee is never automatically dismissed for doing something, even if it says so in the contract. Fair procedures must always be followed.
You cannot “not appoint” an employee after the probation period, unless you have followed a fair procedure.

You need to ensure that your contracts are in line with the legislation to guard against doing something that is unfair (and will end up costly) without knowing it was unfair. When in doubt check with an expert.admin@employmentrelations.co.za

When must I pay overtime?

Overtime is hours worked beyond the ordinary hours of work. Here are examples to demonstrate how it works:

If your contract says an employee works from 08:00 to 16:00, any work done before 08:00 and after 16:00 is deemed overtime.

If your contract says an employee ordinarily works 40 hours a week, then overtime starts when the employee works more than 40 hours a week. NOTE: You need a written averaging of hours agreement to implement this.

You need to pay overtime for employees who earn less than the earnings threshold (currently R205 433.30 per year CTC).

How is overtime paid?

Overtime is paid at 1.5 times the ordinary hourly wage rate. Alternatively, by agreement, you can give an employee paid time off in the following ways:

Pay them their ordinary hourly wage for the overtime hours worked and then give them 30 minutes paid time off for each overtime hour worked.
Don’t pay them for the overtime worked, but then give them 90 minutes paid time off per overtime hour worked.

As you will notice, the amount received by the employee will remain the same in each example but giving time off might be beneficial for the operations of the company or cash flow (paid time off can be granted later by agreement).

When should I start UIF contributions?

When an employee works more than 24 hours in month for you.

UIF contributions must start from commencement of employment. This includes employees who are in their probationary period.

What is labour relations, industrial relations and employee relations?

The terms are often used interchangeably, however, they are technically speaking not synonymous. Industrial Relations (the original term) is mostly associated with a blue-collar context (Salamon, 2000), because it comes from the spread of industrialisation.

Labour relations includes white-collar workers and service-related industries. The terms ‘labour relations’ and ‘industrial relations’ are very similar in that they both refer to the collective dimension of the relationship (that is employees being represented by trade unions).

Employment relations, on the other hand, encompasses both the individual and the collective relationship, whereas ‘labour relations’ and ‘industrial relations’ focus primarily on the collective dimension (Venter & Levy, 2014). Employment relations is thus the preferred term as is provides for a greater scope covering all aspects of the relationship.

Casual employees, what does that mean?

There is no definition of ‘casual’ worker/employee in our current legislation. Generally, the term refers to employees who work on a temporary basis or part time. If the employees work more than 24 hours in a month, they are seen as permanent employees and are entitled to the basic conditions of employment as provided for in the BCEA (Basic Conditions of Employment Act).

Also take note of Section 198C of the Labour Relations Act that regulates the treatment of part-time employees.

We assist clients to ensure compliance with the latest legislation:admin@employmentrelations.co.za

Parental leave or paternal leave?

The new provisions that have been written into the legislation provide for parental leave in South Africa. Paternal refers only to the father of the child, whereas ‘parental’ is more inclusive as it refers to the parent (mother, father, adoptive parents, surrogacy agreements, etc).

Contact us if you would like to know more about the implementation of parental leave in South Africa:admin@employmentrelations.co.za.

What is a constructive dismissal?

Constructive dismissal is when an employee resigns because the employer made continued employment intolerable for the employee (Section 186 of the LRA).

An employee needs to prove the following in a constructive dismissal claim:

The employee must show that he/she resigned (i.e. that he/she initiated the termination of employment);
The employee will need to prove intolerability and that resignation was a last resort, with no other motive for the resignation. The test is an objective one and a mere feeling of being aggrieved is not sufficient; and
The employee must show that the employer’s conduct created the intolerable circumstances (i.e. an employment relationship can be intolerable where the employer’s conduct did not create it).

We can assist you to better understand constructive dismissals:admin@employmentrelations.co.za

“The employee is automatically dismissed”, is this compliant with the legislation?

No. An employee cannot ever be automatically dismissed (even if it says so in the contract). An employee may only be dismissed for one of the following reasons: misconduct, incapacity or operational requirements (retrenchment). Each one of those reasons has a prescribed procedure to be followed before an employee may be dismissed. Those prescribed procedures are detailed below:

Misconduct: No matter how severe the transgression. An employee is entitled to a disciplinary hearing or inquiry prior to being dismissed for misconduct. The hearing/inquiry needs to meet the requirements of Schedule 8 (Code of Good Practice: Dismissals).

Incapacity: Whether an employee is incapacitated due to medical reasons or due to poor work performance, there needs to be some form of an investigation or inquiry that meets the requirements of Schedule 8 (Code of Good Practice: Dismissals) prior to dismissing an employee. Poor work performance dismissals require additional counselling/evaluation sessions to be conducted over a period of time.

Operational Requirements: A formal consultation procedure as set out in Section 189 of the Labour Relations Act must be followed prior to dismissing any employee for operational requirements. This consultation must be started as soon as an Employer contemplates dismissing one or more employees.

To ensure that you follow a fair procedure prior to dismissing an employee contact us:admin@employmentrelations.co.za

“The employee dismissed him/herself”, is that possible?

No. Although we have heard this phrase used by employers, managers and even practitioners, it is not possible for an employee to dismiss him/herself. An employee resigns and an employer dismisses an employee. The term “dismissal” is used to refer to termination of employment by the employer (except in constructive dismissal cases). The phrase an employee dismissed him/herself is usually used when referring to an employee that absconded (absent from work without the intention to return). However, even in absconsion cases the employer must terminate the relationship (dismiss the employee) due to the employee having had absconded.

For assistance with abscontion cases and the correct absconsion procedure contact us:admin@employmentrelations.co.za

Frequently Asked Questions

Contracts

Terms & Conditions of Employment

Payments

Terminology

Dismissals