ABV 320 LECTURE 3 (3.1-3.

4)

Outcomes:
1. Demonstrate understanding of international labour policies and standards.
2. Apply and describe the legislative framework governing relations between the employer and
employee.
International labour organisation
• Governments are regulated by universally accepted standards supplied by various conventions
and recommendations of the ILO which are ratified and implemented by member countries.
• Recommendations and conventions have been passed concerning almost every aspect of the
employment relationship. For the present purpose we are concerned only with those which
establish the basic principles for the conduct of the relationship. These are:
o Declaration of Philadelphia
o Convention 87 concerning the Freedom of Association and Protection of the Right to
Organise
o Convention 98 concerning the Application of the Principles of the Right to Organise and
Bargain collectively

Declaration of Philadelphia: (PART 1 TO PART 3)

• Declaration of Philadelphia reaffirms the main principles on which the ILO is based.
• Regarded as the founding document of the International Labour Organisation.
PART 1:
o Labour is not a commodity (workers should not be treated as capital or mere factor of
production)
o Freedom of expression and association
o Poverty anywhere constitutes a danger to prosperity everywhere
o War against poverty should be carried on in an atmosphere which encourages free discussion
and democratic decision-making.

PART 2 affirms the ideological premise of the ILO, i.e., ‘all human beings, irrespective of race, creed
or sex, have the right to pursue both their material wellbeing and their spiritual development in
conditions of freedom and dignity, of economic security and equal opportunity

PART 3: is more specific in that it sets ILO the task of promoting full employment and raising the
standard of living of all people.
• This should be achieved by:
o promoting training
o facilitating the transfer of labour
o setting policies regarding wages and conditions of service
o recognising the right to collective bargaining
o promoting cooperation between management and labour to improve productive efficiency
o encouraging collaboration between workers and employers in deciding on social and
economic measures
o establishing social security measures
o instituting comprehensive medical care
o protecting the life and health of workers
o making provision for child welfare and maternity protection
o making provision for adequate cultural facilities for all employees
Convention No 87 Concerning the Freedom of Association and Protection of the Right to Organise
• Convention No 87 enlarges on one of the founding statements of the Declaration of Philadelphia,
namely that ‘… freedom of association and expression are essential for sustained progress’.
• Recommends and safeguards against anti-union discrimination such as:
o Employers and employees have the right to join any organization of their choice without any
previous authorization.
o Trade unions and employers’ organisations may draw up their own constitution, rules, elect
representatives freely, to organise their administration and activities and to formulate their
programmes.
o Governments, i.e., public authorities shall refrain from any interference which would restrict
this right or impede the lawful exercise thereof (not to interfere with organisations)
o Workers’ and employers’ organisations shall not be liable to be dissolved or suspended by
administrative authority.
o Employers, employees, and their organisations to respect law of land
o Law shall not be such to impair these organisations or implied as to impair.
o Members of ILO to take steps to ensure employers and employees exercise their right to
organize freely.

Convention No 98 Concerning the Application of the Principles of the Right to Organise and to
Bargain Collectively
• Offers protection against anti-union discrimination such as prohibiting acts which have the effect
to:
o Make an employee or prospective employee agree not to join a union or to give up union
membership.
o Allow an employer to dismiss an employee or otherwise prejudice him/her because of union
membership or because of participation in union activities.
o Promote the establishment of workers’ organisations under the domination of employers or
employers’ organisations.
o Allow employers to support workers’ organisations by financial or other means.

The constitutional framework

• The Constitution of the Republic of South Africa sets out certain fundamental rights of all
persons
• content of constitution is binding on ‘all legislative and executive organs of State at all levels of
government’.
• This means that no law may contain provisions which deprive individuals of these fundamental
rights.
• The Constitution does provide that rights may be limited by law but on condition that:
✓ The limitation is reasonable and justifiable in an open and democratic society based on
freedom and equality
✓ The limitation does not negate the essential content of the right in question
• No rights are limitless, as the exercise of an individual’s rights may impinge on the rights of
others.
• Thus, the law may limit these rights, but cannot remove them altogether
• Section 23 in the Constitution relates specifically to labour relations and provides that:
o Everyone has the right to fair labour practices.
o Every worker has the right to form and join a trade union; to participate in the activities and
programmes of a trade union; and to strike.
o Every employer has the right to form and join an employers' organisation; and to participate
in the activities and programmes of an employers' organisation.
o Every trade union and every employers' organisation has the right to determine its own
administration, programmes and activities; to organise; and to form and join a federation.
o Every trade union, employers' organisation and employer has the right to engage in
collective bargaining. National legislation may be enacted to regulate collective bargaining.

There are other sections in the ‘Bill of Rights’ which will affect labour relations and labour
legislation. The following are examples:
o Section 9 - Equality: You cannot be discriminated against, however affirmative action and
fair discrimination are permissible
o Section 10 - Human dignity: Your dignity must be respected and protected. e.g Workplace
Conditions
o Section 14 – Privacy: You cannot be searched or have your home or possessions searched.
o Section 16 - Rights to freedom of speech and expression: All people (including the press)
can say whatever they want. e.g Whistleblowing, right to Information and Collective
Bargaining.
o Section 17 - Assembly, demonstration, picket & petition: You can hold a demonstration,
picket and present a petition. But you must do this peacefully
o Section 18 - Freedom of Association: You can associate with whomever you want to.in the
LR perspective this includes the right to form and join a union/employers organisation, right
to strike and collective bargaining.
• Because these rights are entrenched in the Constitution, all labour legislation and actions and
processes in labour relations should be evaluated in this context. If a law or a provision in a law
negates any of these rights, it may be challenged in the Constitutional Court.

Employment contract= The first step in determining the existence of an employment relationship
between the employer and employee

Requirements of a valid contract:

✓ Consensus (offer and acceptance):
Parties should have the intention to enter into a legally binding agreement. Offer and
acceptance-One party(employer) should make an offer to the other(employee)
wherein the offer will be accepted unconditionally (accepted by employee).
✓ Contractual capacity:
The parties to an agreement must have legal capacity. If one of the parties is not contractually
capable, the contract is not valid. According to the following people are incapable. (a) minors, (b)
persons with an unhealthy mind and (c) persons disqualified by the law to which they are subject
✓ Legality:
It must not be illegal, immoral or contrary to public policy. It is legal unless prohibited by law. If
the object of the contract is not lawful, the contract is void. A contract involving criminal activity
 is not valid. A legal contract is an agreement between two parties that creates mutual and legally
enforceable obligations.
✓ Possibility of performance:
Parties should be able to fulfil the rights and obligations of the agreement e.g employee
should have all the required skills and competencies to perform his duties and
employer should provide the employee with all the necessary tools of trade.
✓ Formalities (fixed term contacts & learnership contracts be in writing):
Employment contracts need not be reduced to writing to be valid and enforceable, however, it is
advisable that they be contained in writing. This could be done for the sake of clarity as well as to
avoid any disputes or to make it easier to settle such disputes. However, an employee cannot
force an employer to provide a written contract.
✓ Exceptions (learnership agreements and fixed-term contracts should at all times be reduced to
writing to be valid)

Existence of contracts:
• An employment contract comes into existence when both parties agree that the employee will
work for the employer.
• A contract may be written, verbal, or it may be understood.
• If no written or verbal agreement has been made, it does not mean that there is no contract.
• The very fact that one person is working for another means that a contract exists.
• Usually, the parties will agree on the kind of work required and on the wage to be paid by the
employer.
• Where this has not been spelt out, the parties can rely on accepted practice.
• For example, an employer who hires a labourer but does not indicate how much he will pay him
will be expected to remunerate him in terms of common practice – that is, he should pay the
rates commonly paid for work of that kind.
• When no definite period of employment is stated, it is taken that the employment is indefinite.
• This is the difference between a permanent and a fixed-term contract

Common law duties of the employer and employee

Common law duties of the Employer:
• Remunerate the employee
• Provide safe and healthy working conditions
• Provide work for employee
• Not make employee perform work junior to the status for which employed
• Not to contract employee out to another employer without permission of employee
• To treat the employee with respect and dignity

Common law duties of the employee

• Perform work faithfully and diligently (with care)
• To be respectful and obey all reasonable instructions given in the normal course of business
• To render services in good faith= not deal dishonestly with the property of the employer
• Not compete with the business of the employer in his private capacity

Void vs voidable contracts of employment

• Void contract is illegal and unenforceable while a voidable contract is legal, and the parties can
enforce it.
• A void contract is invalid or entirely against the law, so no one involved can say it is enforceable
under the law. Contracts that are voidable are valid and legally enforceable.
Void contracts: are without legal effect from the moment it is created. It is as if the contract never
existed, and the parties are not legally bound by its terms. Void contracts are unenforceable by law
because they lack the essential elements required to create a valid and binding agreement. Void
contracts:
✓ illegal (if breach of a statute or of the common law)
✓ immoral (interests of the community)
✓ contrary to public policy (interests of the community)

Null and void contracts

In simple terms the word void means something is not valid and it is not legally binding. When we
say a contract is void, that means it's null, void, and that it is not backed by the force of law. That
makes it unenforceable, and if anyone breaches an unenforceable contract, the other party to the
contract has no legal recourse against them.

Voidable contracts
A voidable contract binds one party, and the other party has the option to change their mind. This
means they can cancel the contract anytime they want. The party is therefore not bound by the
contract has the control in this type of contract. A mutual mistake on the part of both parties to a
contract makes it voidable. If one or more pieces of material information are omitted from the
contract, that also makes it voidable. A contract involving a minor is one example of a voidable
agreement. Examples of conducts which render a contract voidable are misrepresentation, coercion
and undue influence.

Contracts are also voidable where the consent of one party has been improperly obtained by:
✓ misrepresentation: a false or misleading statement of fact made during negotiations by one
party to another, the statement then inducing that other party to enter into a contract. The
misled party may normally rescind the contract.
✓ coercion: of persuading someone to do something by using force or threats
✓ undue influence: influence by which a person is induced to act otherwise than by their own free
will or without adequate attention to the consequences.

• For example, the contract of a person who declares in an application that he has previous
experience when he has none, can be cancelled by the employer. The contract can also be
declared void if one of the parties does not have contractual capacity – for example, is underage.
• Effect of voidable contracts on the validity of the employment contract- voidable contract is
initially considered legal and enforceable but can be rejected by one party if the contract is
discovered to have defects. If a party with the power to reject the contract chooses not to reject
the contract despite the defect, the contract remains valid and enforceable.

Breach of contract
• Breach of contract occurs in instances where one party fails to comply with the obligations of the
contract.
• An employer who has for five years paid his employees on the 15th of each month and who
unilaterally decides to pay them on the 25th may be held to be in breach of contract, even if
there is no specific provision for payment on the 15th.
• Section 77(3) of the Basic Conditions of Employment Act now also grants the Labour Court the
right to adjudicate on matters related to the contract of employment, including alleged breach of
contract.
• Material and less forms of breach of contract:
✓ Material e.g., theft, harassment, fraud, violence
✓ Less serious e.g., late coming

• Common law remedies:

✓ Cancellation: a remedy that allows the innocent party to treat the contract as void and bring
the contractual relationship to an end. In other words, the innocent party can choose to
cancel the contract and be relieved of any further obligations under it. This remedy is
typically used when the breach is significant and fundamental, making it impossible or highly
undesirable for the innocent party to continue with the contract.
✓ Damages: Damages are monetary compensation awarded to the innocent party to
compensate for the financial loss they suffered due to the breach of contract.
✓ Specific performance: Specific performance is a remedy where a court orders the breaching
party to fulfil their contractual obligations as specified in the contract. This remedy is
typically used when the subject matter of the contract is unique or rare, such as real estate,
art, or a specific type of service. It's often sought when monetary damages would not be
sufficient to fully compensate the innocent party, as the unique nature of the contract makes
it difficult to find a substitute.

• Statutory remedies LRA: (in cases of unfair dismissal)

✓ Reinstatement: Reinstatement is a statutory remedy that requires the employer to re-
employ the dismissed employee in the same position they held prior to the dismissal. This
means that the employee is essentially placed back into their former job, with all the rights
and benefits they enjoyed before the dismissal. Reinstatement aims to restore the
employment relationship as if the unfair dismissal never occurred. However, it's important to
note that reinstatement might not be feasible or appropriate in all cases, especially if there
has been a breakdown of trust between the parties.
✓ Re-employment: Re-employment is a similar remedy to reinstatement, but instead of being
placed back into the original position, the dismissed employee is offered a new position
within the same organization. While the employee may not return to the exact same role,
they are provided with alternative employment. Re-employment still aims to provide the
employee with ongoing job security and continuity of employment.
✓ Compensation (amount should be fair and equitable): Compensation is a monetary remedy
awarded to the unfairly dismissed employee to compensate for the loss of income and other
financial losses resulting from the unfair dismissal. The ERA specifies that the amount of
compensation should be "just and equitable" considering the circumstances of the case. The
compensation is intended to cover the financial impact of the dismissal, including lost wages,
benefits, and other direct financial losses.
Termination of contract (SEE TERMINATION CONTRACT LATER IN THE SUMMARY)
At common law a contract of employment which does not contain specific conditions relating to
termination may be terminated upon:
• reasonable notice by either party
A contract of employment can be terminated by either the employer or the employee by
providing reasonable notice to the other party. The notice period is typically determined by the
length of employment, job role, and industry practices. This allows for a gradual end to the
employment relationship, giving both parties time to make necessary arrangements.
• the consent of both parties
If both the employer and the employee mutually agree, the contract of employment can be
terminated without the need for notice. This often occurs when both parties are in alignment
about ending the employment relationship.
• the death or incapacity of the employee
The contract of employment is automatically terminated if the employee passes away or
becomes permanently incapacitated, making it impossible for them to fulfil their job duties.
• the insolvency of the employer
If the employer becomes insolvent, such as going into bankruptcy, receivership, or liquidation,
the contract of employment may be terminated as a result of the business's financial
circumstances.
• Effluxion of time
When a contract of employment has a fixed term, it automatically comes to an end once that
term expires. No notice is typically required in this case, as the termination is pre-determined by
the passage of time.
• Operational requirements
Employment contracts can be terminated due to operational requirements of the business, such
as restructuring, downsizing, or changes in business strategy. This termination may be carried
out with proper notice or compensation, depending on labor laws and contractual terms.
• Dismissal
Dismissal refers to the termination of an employment contract by the employer due to reasons
such as poor performance, misconduct, or other breaches of the employment agreement.
Dismissal can only occur when there is valid cause and often requires adherence to fair
procedures and due process, as outlined by employment laws.
• Notice periods subject to BCEA:
o 1 week = employed less than 6 months
o 2 weeks = employment longer than 6 months
o 1 month = employed longer than a year or is a farm worker employed for longer than 6
months
Who is the employee?
• s213 of the LRA
• Common law
• s200A of the LRA
• Code of Good Practice ”who is an employee”

• s213 of the LRA

1. any person excluding an independent contractor, who works for another person or for the
state, and who receives, or is entitled to receive, any remuneration; and
2. any other person who in any manner assists in carrying on or conducting the business of an
employer.

• Common law
o Common law tests (to determine if an employee contract exists)
✓ Control test: when a principal has the right to supervise and control the work to be
done, the relationship between the parties would be one of employment.
ꟷ Does the person obey the lawful and reasonable commands, orders or instructions
of the employer or the employer‘s personnel (e.g. managers or supervisors) as to the
manner in which they are to work?
ꟷ The higher the degree of control and supervision, the higher the chances that a
person is an employee. (An employment contract needs the employer to not only
define the work but also control how it's done.)
✓ Organisational test:
ꟷ Does the person form part of the organisation?
ꟷ Control over the work. For example, if someone controls when you work, where you
work and how you work, it is more likely that you are a worker and not an
independent operator.
ꟷ Tests how integrated the person is in the organisation structure.
✓ Dominant impression test:
ꟷ The weighing-up of a number of factors against one another
ꟷ The factors considered are not exhaustive and the courts have held that there is no
single factor that is decisive in determining the existence of a contract of
employment.
ꟷ This test emphasizes that no single factor can determine employment status -all
aspects of the work arrangement are weighed together to make a decision.

McKenzie’s case: employee contract vs independent contract?

• McKenzie was employed by SABC as a permanent worker.
• Later, the SABC asked McKenzie to host a talk show as a freelancer, and he agreed to an oral
contract.
• His freelancer contract was renewed yearly, along with a separate contract for another show he
presented.
• McKenzie received different contracts compared to permanent employees.
• Later, the SABC indicated his contract might not be renewed due to program policy changes.
• Both shows hosted by McKenzie ended.
• McKenzie argued he was an employee, not an independent contractor.
• The Labor Court agreed, ordered SABC to pay him compensation of R45,000.
• SABC appealed, maintaining that McKenzie was an independent contractor.
The test was used in Mc Kenzie case. The court found that:

a) if the object of the contract was for the performance of specified work or a specified result, it
would be an indication that the person is an independent contractor
b) If the person rendering the service was subject to the supervision and control of the employer or
was obliged to render the service personally, it would be indicative of an employment contract
c) The court further considered when the relevant contract would terminate. If it terminated on the
death of the person rendering the service, that would be an indication that the person was an
employee.

Findings of the industrial court:

• The circumstances of the termination of [McKenzie’s] contract with the [SABC] constituted an
unfair labour practice.
• The [SABC] is ordered to pay compensation to [McKenzie] in an amount of R 45 000.
• Costs are awarded to [McKenzie] on the Supreme Court scale such costs to include the costs
related to the initial hearing in respect of the determination of the jurisdiction of the Court.’
• HOWEVER, the SABC appealed against the ruling that McKenzie was its employee, the finding
that it committed an unfair labour practice, the award of compensation and the order for costs

Findings of the labour appeal court:

• The preliminary point, namely, whether the applicant (McKenzie) was an employee of the
respondent (SABC), is decided in favour of the respondent (SABC).
• McKenzie was considered an independent contractor.
• SABC won!
• (use the findings of the labour appeal court)

s200A of the LRA: Presumptions of who is an employee.

1. The manner in which the person works is subject to the control or direction of another
person
2. The person’s hours of work are subject to the control or direction of another person
3. In the case of a person who works for an organisation, the person forms part of that
organisation
4. The person has worked for that other person for an average of at least 40hours per month
over the last three months
5. The person is economically dependent on the other person for whom he or she works or
renders services
6. The person is provided with tools of trade or work equipment by the other person or
7. The person only works for or renders services to one person.

• Code of Good Practice “who is an employee”

o The provisions above are applicable to persons who earn below the threshold R241 110.59
per year (which equates to about R20 093.00 per month)
o The Code of Good Practice: Who is an employee provides further guidance on this
o If the person earns above the threshold these guidelines may also be used to provide clarity
on whether the person is an employee or not
o In determining if a person is an employee the following should be present
✓ Does the person render services to the person or entity listed in the proceedings?
 ✓ Any one of the seven listed factors is present in their relationship with that person or
entity.
o I.e., the Code of Good Practice elaborates on the above 7 criteria and clarifies the concept of
"presumption." If any of the factors are present, a person can assert they are an employee.
However, this doesn't guarantee automatic acceptance of the claim; instead, the employer must
then prove that the claimant is not an employee. The Code encourages considering all factors,
using the dominant impression test, and applying guidelines like those established in the SABC
case mentioned later in the document.

Employee vs independent contractor:

SABC Broadcasting Corporation v McKenzie LAC (Labour Appeal Court)

▪ The object of the contract of service is the rendering of personal services by the employee to the
employer.
▪ Independent contractor is not obliged to perform work or produce results himself, unless
otherwise agreed
▪ Services to be rendered in terms of a contract of service are at the disposal of the employer who
may in his own discretion subject of course to questions of repudiation decide whether or not he
wants to have them rendered. The independent contractor is bound to perform a certain
specified work or produce a certain specified result within a time or reasonable time
▪ The employee is subordinate to the will of the employer & obeys lawful commands of the
employer who has the right to supervise & control; whereas an independent contractor is
notionally on a footing of equality with the employer & the independent contractor is his own
master.
▪ A contract of service is terminated by death of the employee whereas the death of the parties to
a contract of work does not necessarily terminate it.
▪ A contract of service terminates on expiration of the period of service entered into while a
contract of work terminates on completion of the specified work on production of the specified
result
 SABC Broadcasting Corporation vs McKenzie LAC (Labour Appeal Court)
Contract of service
• Employee renders personal services to the employer.
• Services rendered are at the disposal of the employer,
who may in his own discretion subject of course to
question or repudiation decide whether or not he wants
them rendered.
• Employee is subordinate to the will of the employer &
obeys lawful commands of the employer who has the
right to supervise & control.
• Contract of service is terminated by death of employee,
whereas
• A contract of service terminates on expiration of the
period of service entered into.
Types of employment contracts:
Indefinite/permanent contracts
o No date for termination of contract is given
o Expectation of relationship to be permanent
o Employees continue to work until they decide to leave or
retire
o Majority of employment contracts are indefinite (parties
expect the relationship to be a permanent one) and no
date of termination is stipulated unless employee:
a) breaches the contract
b) becomes ill or incapacitated to perform his duties
c) operational requirements permit the employer to
downsize its workforce
d) Commits misconduct
Part-time contracts
• They are paid wholly or partly depending on the basis of
time worked and works less hours than a comparable
employee.
• Comparable employee: those who are also paid, wholly
or partly, according to hours worked, but are employed on
a full-time basis.
• The LRA offers extensive protection to part time workers
such as:
o That part time and comparable employees who
perform the same work should be treated equally
o Both part time and comparable full time employees
should be provided with equal access to training and
skills development opportunities
o Both comparable and part time employees to be
provided with same access to opportunities to apply
for vacancies.
Independent contract
• Independent contractor is not obliged to perform work
or produce results himself unless agreed otherwise.
• Independent contractor is bound to perform certain
specified work or produce specified results in within time
or reasonable time.
• Independent contractor is notionally on a footing of
equality with the employer & the independent
contractor is his own master.
• The death of the independent contractor or the other
parties involved doesn't automatically terminate the
contract.
• Independent contract terminates on completion of the
specified work on production of the specified result
Fixed term contracts
Employees employed to provide services for a specified
period or for a particular project.
S 198B(1) of The LRA defines it as a contracts which ends on:
a) Occurrence of specified event
b) Completion of a specific task or project
c) Fixed date (but not the employee’s normal retirement
date)
(see below examples)
Labour brokers
S 198 of the LRA provides that a labour broker (TSA) means
work for a client by an employee:
a) For period not exceeding 3m (after 3m, regarded as
permanent)
b) As a substitute for an employee of the client who is
temporarily absent
• TES: Temporary Employment Service: where any person
(employee) is provided to a client by a labour broker
(TES).
• Employee performs work for the labour broker’s client
but is paid by the labour broker (TES)
• Employee regarded as employee of the TES and not of
the client.
• Both the TES and the client are jointly and severally liable
for any contravention of a bargaining council agreement,
an arbitration award setting out conditions of service,
Rules don't apply to workers who work less than 24 hours per the Basic Conditions of Employment Act or a wage
month or within the initial six months at a job. They also don't determination.
apply to workplaces with under 10 employees or businesses
under 2 years old with under 50 employees.

Fixed term contracts examples:

a) Occurrence of specified event
• Scenario: ABC Marketing Agency hires John as a project manager for a specific marketing
campaign. The employment contract stipulates that John's employment will end upon the
successful completion of the campaign. If the campaign achieves its goals and metrics, John's
employment will automatically terminate.
• Employment Contract Clause: "This employment contract shall terminate upon the successful
completion of the [specific campaign name] marketing campaign. Successful completion is
defined as achieving the predetermined goals and metrics for the campaign.
b) Completion of a specific task or project
• Scenario: Tech Solutions Inc. hires Emily as a software developer to build a custom software
application for a client. The employment contract specifies that Emily's employment will end
upon the completion and delivery of the software application to the client. Once the client
approves the software, Emily's contract will come to an end.
• Employment Contract Clause: “This employment contract shall terminate upon the
completion, testing, and successful delivery of the custom software application to the client.
Upon client approval, the employee's obligations under this contract shall be considered
fulfilled.”
c) Fixed date (but not the employee’s normal retirement date)
• Scenario: Sunny Resorts hires Maria as a lifeguard for the summer season, which runs from
June 1st to August 31st. The employment contract outlines that Maria's employment will
automatically terminate on August 31st, regardless of any other conditions. Maria will not be
obligated to continue working beyond the specified seasonal period.
• Employment Contract Clause: “This employment contract shall terminate on August 31st,
marking the end of the summer season. The employee's responsibilities under this contract
shall cease on this date.”

More on fixed term contracts: (NOT IN SLIDES)

Fixed-term contracts typically end on a set date or after an event, like project completion. If work
takes longer, the contract can be extended for a specific period but not indefinitely.
In terms of S186 of the Labour Relations Act an employee on a fixed-term contract may claim that
he was unfairly dismissed if:
• he expected the contract to be renewed on the same or similar basis and the employer did not
renew the contract or renewed it on less favourable terms
• he reasonably expected to be retained indefinitely on the same or similar terms and he was not
retained or was offered a permanent position on less favourable terms.

A fixed-term employee, like other employees, can also claim that he was unfairly dismissed if:
• he resigned because employer made it impossible for him to continue
• his contract was transferred to another employer and the new conditions of service are
‘substantially less favourable than those with the previous employer.
Protection to vulnerable employees (s198B of the LRA):
LRA provides increased protection for employees earning below earnings threshold (R241,110.59 per
year or R20,093 per month) in cases involving fixed-term contracts, part-time contracts, or services
provided by TES (labour brokers). Employee cannot be employed for a period exceeding 3 months,
should that occur the employer will have to justify his reasons such as:
• Employee is replacing an employee who is temporarily absent
• Due to increased workload (shouldn’t last longer than 12m)
• Employee is a seasonal worker
• Employee is employed to work on a project that had a limited or defined duration
• Employee is a student or recent graduate who is employed to gain experience before entering
the job market
• Employee is a non-citizen who has been granted a work permit for a specified period
• Employed in an official public works scheme or similar job creation initiative
• Employee is past normal or agreed retirement age
• Employee is performing work which is funded by an external agency.

✓ Any contract with vulnerable employees which exceeds 3 months and does not conform to the
above conditions will be regarded as a permanent contract irrespective of the wording in the
contract.
✓ Where a fixed-term contract has been extended to two years or more the employee must be
given retrenchment pay when the contract ends unless the employer has been able to find him
a similar position commencing immediately thereafter.

The Act further states that:

• All fixed-term contracts must be in writing
• Employer must give the reason why the contract is of extended duration.

Also, the employer must:

• not treat an employee whose contract exceeds 3 months less favourably than other employees
doing the same or similar work
• give such employee the same access to opportunities as permanent workers
• pay someone who has worked on a fixed-term contract for longer than 24 months, severance
pay of one week’s pay per year of service or whatever higher amount is contained in a bargaining
council agreement or sectoral determination.
Substantive acts (Basic conditions of employment and employment equity)
Basic Conditions of Employment Act (Act 75 of 1997)
Purpose:
- Conditions cannot be less favourable than those contained in this Act
- Ensure all employees enjoy certain min conditions of employment
Employees not covered by the Act:
- National Intelligence Agency
- South African Secret Service
- South African National Academy of Intelligence
- Directors and staff of Communications Security (COMSEC)
- Employed by the sea
- Merchant Shipping Act
- Workers that work less than 24h a month
- Managers and employees earning more than the threshold
• Basic conditions of employment:
1. Conditions of employment
o BCEA (Basic Conditions of Employment Act)
o Common law
o Ministerial determinations
o Bargaining councils
2. Employee welfare
o UIA
o COIDA
o OHSA
o NMWA (Minimum Wage Act)
BCEA: Section 29
a) full name and address of the employer
b) name and occupation of the employee, or a brief description of the work
c) various places of work
d) date of employment
e) ordinary hours of work and days of work
f) wage or the rate and method of calculating
g) rate for overtime work
h) any other cash payments
i) any payment in kind and the value thereof
j) frequency of remuneration
k) any deductions
l) leave entitlement
m) period of notice or period of contract;
n) description of any council or sectoral determination which covers the employer’s business
o) period of employment with a previous employer that counts towards the period of employment
p) list of any other documents that form part of the contract, indicating a place where a copy of
each may be obtained.
Leave
Annual leave o 21d consecutive days annual leave with full pay, only after 12m of service
o 1d for every 17d worked
o 1h for every 7h worked
Sick leave o During first 6m of employment, the employee is entitled to 1d paid sick leave in every 26d
worked.
o Any sick leave days taken during the first 6m of employment is deducted from the full 36m
entitlement
o An employee’s sick leave is equal to the number of days the employee would work in six
weeks. So, for an employee who works from Monday to Friday, it is 30d
E.g., if the employee works a five-day week, then his sick leave entitlement in every 36 months
cycle is 30 (5x6) days on full pay. If he works a six day week, then his entitlement is 36(6x6 )days on
full pay.
Family o 3d after 4m of service for close family members, sick or death, birth of child, employer can ask
responsibility for proof
leave
Parental leave o Every employee is entitled to 10d parental leave irrespective of employee’s gender
o Also applicable where employee legally adopts a child or when child is placed by a court in care
of prospective adoptive parent.
Maternity leave o 4m unpaid maternity leave
o Leave commences 1m before birth of a child and employee may not work 6ws after the birth of
child
Unemployment Employee who is not compensated during maternity leave may lodge a claim with the UIF
Insurance Fund
(UIF)

Other:
Working hours o Max working hours are 45h per week
o Maximum 9h per day if employee works 5d a week or
o 8h per day if employee works more than 5d a week
o Meal breaks are not included in the 45 HRS
Overtime o Overtime can only be worked by agreement between employer and employee
o Limited to 10h per week or 3h per day
o Can be increased to 15h per week for period of 2m by agreement
o Payment will be 1.5x the normal wage rate
Sunday work o Remunerated 2x normal wage rate for each hour worked
o Unless he ordinarily works on a Sunday, in which case he must be remunerated at 1.5x his
normal wage rate for each hour worked
Public holidays o No employer may require employee to work on public holidays (except with agreement)
o If public holiday falls on a day on which the employee would ordinarily work then if he works
on that public holiday he is entitled to be paid at least 2x his normal wage rate for the day, or if
he does not work, he is entitled to have the day off and be paid his normal wage rate for the
day.
Notice of termination
• The BCEA stipulates further that notice of termination of a contract of employment must be
given in writing except when it is given to or by any illiterate employee.
• Notice of termination of employment, when given by the employer, must not be given during
any period of leave to which the employee is entitled, and may not run concurrently with any
period of leave to which the employee is entitled, except sick leave.
• E.g., if an employer dismisses an employee, and the employee has annual leave due to him,
the employer may not require that the dismissed employee take the outstanding annual leave
during the period of notice. The employer is required to pay the employee for this leave.
However, should the employee require sick leave during a period of notice, and he/she has sick
leave days available, then the employee is entitled to take paid sick leave during a period of
notice.

S37 of the BCEA: A contract of employment may be terminated on notice of not less than:
(a) 1 week, if the employee has been employed for 6m or less
(b) 2 weeks, if the employee has been employed for more than 6m but not more than 1y
(c) 4 weeks, if the employee has been employed for 1y or more or is a farm worker or domestic
worker who has been employed for 4w or more

Example of employee termination letter:

Tutorial questions for unit 3 (3.1-3.4)

Question 1: Draft an employee termination letter. Ethan Hunt got dismissed for unethical conduct,
breach of contract, and sexual misconduct (10)

Question 2: Discuss the declaration of Philadelphia (9)

Question 3: What does section 23 of the constitution provide? (5)

Question 4: List the common law duties of the employer and employee (8)
Read:

Question 5: Is John an employee or independent contractor? (10)

Do the Mock test!!!!