Welman Attorneys Inc.

The Legal Meaning Public Holidays in April and May in South Africa

Joe Diedericks — Mon, 13 Apr 2026 14:43:34 +0000

As April transitions into May, South Africa observes two of its most significant public holidays – Freedom Day and Workers’ Day. While many see these as opportunities for rest, they are deeply rooted in the country’s legal and constitutional framework.

For businesses and employees alike, these dates carry important implications, particularly in the context of labour law.

At Welman Attorneys Inc., understanding the legal foundation behind these holidays is essential for ensuring compliance and promoting fair workplace practices.

Why Public Holidays Exist in South Africa

Public holidays in South Africa are governed by the Public Holidays Act 36 of 1994. This legislation formalised a calendar that reflects the country’s democratic values and historical milestones.

These holidays are designed to commemorate key events that shaped the nation, particularly the transition to democracy and the recognition of fundamental human rights.

From a legal perspective, public holidays are not merely symbolic – they directly affect employment relationships. The Basic Conditions of Employment Act (BCEA) outlines how employees must be treated on public holidays, including rules around paid leave and compensation for work performed on these days.

Freedom Day (27 April): A Constitutional Milestone

Freedom Day commemorates South Africa’s first democratic elections in 1994. This historic moment marked the end of apartheid and the beginning of a constitutional democracy founded on equality, dignity, and human rights.

For legal practitioners, Freedom Day represents the foundation of modern South African law. The Constitution, which followed shortly thereafter, established key rights that continue to shape employment law today, including the right to fair labour practices.

Every employment contract and workplace policy must align with these constitutional principles, making Freedom Day a cornerstone of the legal system.

Workers’ Day (1 May): The Foundation of Labour Rights

Workers’ Day is one of the most important dates in the labour law calendar. Celebrated on 1 May, it honours the struggles of workers and trade unions in securing fair working conditions.

Its origins lie in the global labour movement, particularly the fight for reasonable working hours and safer workplaces. In South Africa, however, Workers’ Day also reflects the role of trade unions in opposing apartheid and advocating for both political and economic rights.

Officially recognised as a public holiday after 1994, Workers’ Day serves as a reminder of the legal protections now embedded in South African law.

Labour Law Implications for Employers and Employees

Workers’ Day highlights several critical aspects of labour law:

Public Holiday Pay: Employees are entitled to paid leave on public holidays. If they work, they must be compensated in accordance with the BCEA.
Fair Labour Practices: Employers must uphold fair treatment, as protected by the Constitution and labour legislation.
Working on Public Holidays: Work on these days must be agreed upon, and additional pay or time off may be required.
Collective Bargaining Rights: The historical role of trade unions reinforces the importance of employee representation in the workplace.

Failure to comply with these requirements can lead to legal disputes and penalties, making it essential for employers to fully understand their obligations.

The Connection Between Freedom Day and Workers’ Day

The timing of these holidays is significant. Freedom Day represents the establishment of democratic rights, while Workers’ Day reflects how those rights are applied in the workplace.

Together, they illustrate the evolution of South Africa’s legal system – from political freedom to economic and workplace fairness. Labour law is, therefore, an extension of constitutional rights, ensuring that dignity and equality are upheld in every employment relationship.

For businesses, these holidays serve as important compliance checkpoints. For employees, they reinforce hard-earned rights and protections.

Welman Attorneys Inc. encourages both employers and employees to view these holidays not only as time off, but as an opportunity to reflect on the legal principles that govern fair and equitable workplaces in South Africa.

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How Employees Benefit from Legal Oversight in an Employer of Record Relationship

Welman Attorneys — Wed, 11 Mar 2026 21:04:00 +0000

Employees in South Africa have recently benefited from the Employer of Record (EOR) model that has created new employment opportunities.

Through an EOR, South African employees can work for international companies while being legally employed by a local provider. This structure allows global companies to access South African talent without establishing a local company.

While this model offers exciting opportunities, it also raises important questions for employees.

Who protects their rights if something goes wrong?

This is where labour law expertise from firms like Welman Attorneys Inc plays an important role.

Employees Are Protected by South African Labour Law

Regardless of whether an employee works directly for a company or through an EOR structure, they are protected by South African labour legislation.

This includes laws such as:

These laws guarantee employees rights related to:

The Complexity of EOR Employment

In an EOR arrangement there are typically three parties involved:

The employee
The EOR provider (legal employer)
The international company directing the work

This three-party relationship can sometimes create confusion about responsibilities and decision-making authority.

For example:

Clear legal structures help ensure employees are treated fairly within this framework.

Legal Oversight Protects Fair Treatment

Labour law attorneys play an important role in ensuring the EOR model operates ethically and legally.

When EOR providers work with experienced labour law specialists, employees benefit from:

1. Proper Employment Contracts

Clear contracts define responsibilities and protect employee rights.

2. Fair Disciplinary Procedures

Employees are entitled to due process before disciplinary action is taken.

3. Lawful Termination Processes

Dismissals must follow legal procedures and be supported by valid reasons.

4. Access to Dispute Resolution

If disagreements arise, employees have access to formal legal mechanisms.

Creating Confidence in Global Employment

The EOR model can create incredible opportunities for South African professionals to work with international companies while remaining protected by local labour law.

With responsible EOR providers and legal guidance from firms like Welman Attorneys Inc, employees can enjoy the benefits of global employment while maintaining the protections offered by South African labour legislation.

When the legal structure is sound, everyone wins – the employer, the EOR provider, and the employee.

If you are an employee working via an EOR or you are in the process of considering working with one, contact us for legal guidance and surety.

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Why Employer of Record Providers Benefit from Working with a Labour Law Attorney

Welman Attorneys — Wed, 11 Mar 2026 20:51:25 +0000

Employer of Record (EOR) providers make it possible for global companies to hire South African talent without establishing a local entity. But with this opportunity comes significant legal responsibility.

Because the EOR is the legal employer on record, it carries substantial liability under South African labour law.

This is why many EOR providers partner with experienced labour law specialists such as Welman Attorneys Inc.

The Legal Responsibility of an Employer of Record

In an EOR structure, the provider is typically responsible for:

Because the EOR is the official employer, employees often direct legal disputes against the EOR provider itself.

These disputes frequently end up at the Commission for Conciliation, Mediation and Arbitration (CCMA).

Without proper legal structures and processes, the risk exposure can be significant.

Key Legal Risks for EOR Providers

The legal environment in South Africa is designed to protect employees. Laws such as the Labour Relations Act require employers to follow strict procedures when disciplining or dismissing employees.

Common risk areas include:

EOR providers must often balance client expectations with legal obligations, which can create difficult situations.

The Value of Proactive Legal Support

Working with a labour law attorney allows EOR providers to operate with greater confidence and professionalism.

1. Contract Structuring

Legal experts help ensure employment contracts and service agreements properly reflect the EOR relationship and allocate risk appropriately.

2. Disciplinary and Dismissal Procedures

Labour law attorneys ensure processes align with South African legal requirements, reducing the likelihood of successful claims.

3. Dispute Representation

If disputes escalate, legal representation at the CCMA becomes essential. Early legal involvement often prevents cases from escalating.

4. Policy Development

Clear workplace policies help EOR providers maintain consistency across multiple international clients.

Strengthening the EOR Industry

As the EOR industry grows in South Africa, providers who prioritise legal compliance will gain a strong competitive advantage.

By partnering with Welman Attorneys Inc, EOR providers gain access to specialised labour law expertise that protects their operations, supports their clients, and ensures fair treatment of employees.

The result is a more resilient and trustworthy EOR service offering.

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Why Companies Using an Employer of Record in SA Still Need a Labour Law Attorney

Welman Attorneys — Wed, 11 Mar 2026 20:12:34 +0000

Expanding into new markets has never been easier thanks to the rise of the Employer of Record (EOR) model. For international businesses looking to hire employees in South Africa, an EOR allows them to employ staff legally without establishing a local entity.

But while an EOR simplifies market entry, it does not eliminate legal risk. South African labour law is highly regulated and employee-protective, meaning international companies still benefit significantly from independent legal oversight.

This is where the expertise of Welman Attorneys Inc becomes critical.

Understanding the Limits of an Employer of Record

An Employer of Record typically manages:

However, the EOR provider’s role is primarily administrative and operational. They are not necessarily responsible for advising the international company on broader labour law risks, strategic employment decisions, or dispute resolution.

International companies often assume the EOR model transfers all legal liability, but in practice the client company still influences employment decisions, which can expose them to legal risk.

A labour law attorney ensures that these risks are properly managed.

South African Labour Law Is Complex

South Africa has one of the most comprehensive labour law systems in the world. Legislation such as the:

creates strict compliance obligations for employers.

If an international company directs an EOR-employed worker in a way that violates these laws, disputes can arise regardless of the EOR structure.

For example:

These issues often end up before the Commission for Conciliation, Mediation and Arbitration and their associated councils.

Legal Guidance for Global Employers

A labour law specialist provides value by helping international companies:

1. Structure Their EOR Relationship Correctly

Legal oversight ensures that the contractual relationship between the international company and the EOR is structured to minimise liability and clarify responsibilities.

2. Navigate Employee Terminations

Termination laws in South Africa require both substantive and procedural fairness. A labour law attorney helps ensure dismissals are legally defensible.

3. Manage Employee Disputes

Disputes can escalate quickly if not handled correctly. Legal guidance ensures the right process is followed from the beginning.

4. Align HR Policies With South African Law

Global companies often try to apply international HR policies that conflict with local regulations. Legal review ensures compliance without disrupting company culture.

Protecting International Growth

Hiring through an EOR is a powerful strategy for entering new markets quickly. But growth should never come at the expense of compliance.

With the guidance and experience of Welman Attorneys Inc in this field, international companies gain a trusted legal partner who understands both South African labour law and the complexities of the EOR employment model.

The result is simple: faster expansion with lower legal risk.

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Applying the 2025 Code of Practice: Dismissal in Small Businesses in South Africa

Welman Attorneys — Mon, 16 Feb 2026 20:20:31 +0000

The Code of Good Practice has been updated in 2025 to provide small business in South Africa with more power when it comes to dismissals in the workplace. However, with more power comes more responsibility to ensure a fair process in followed.

At Welman Attorneys Inc. we assist our customers with guidance on a weekly basis to ensure the process is fair towards not only the business, but also towards the employee.

Our quick reference guide for manager’s was developed to ensure small business comply with the legal requirements.

1. What And Who This Guide Is For

This guide helps small business owners and managers handle:

This needs to be done in a way that is legal, fair, and practical, even if you have no HR department.

2. Small Business Principles (2025 Code)

The 2025 Code now recognises small businesses and allows simpler processes as long as things are still fair.

You do NOT need

You DO need

3. Misconduct: Step-by-Step for Small Businesses

Misconduct is when an employee broke a rule or acted badly. The following are steps to guide you when conducting an enquiry into misconduct by an employee.

Examples of misconduct

Absenteeism
Theft or fraud
Fighting
Insubordination
Poor behaviour
Harassment
Repeated lateness

Step 1: Have a quick investigation

This can be very basic:

Step 2: Invite the employee to a “Misconduct Discussion”

Use simple language:

“I need to talk to you about a workplace issue. You can bring a co-worker if you want.”

Give them:

Step 3: The meeting

Keep it conversational and use the following basic procedure for the meeting:

Step 4: Decide on the outcome

Possible outcomes after of during the meeting could be:

Note that dismissal of an employee is only fair if:

Step 5: Give the outcome in writing to the employee

Keep it short and simple:

“After our meeting today, you are issued a written/final warning for ___.” 

OR: 

“Your employment is terminated due to serious misconduct.”

Keep a copy of your communication and ensure it contains the dates of the allegations, when the employee was informed of the allegations and meeting, when the meeting took place, and the date the employee received the outcome.

4. Performance Problems (Poor Work Performance)

Performance relating to problems and poor performance is when the employee can’t do the job properly, even if they are trying. The following steps is a guidance on how to address this situation.

Step 1: Tell them what’s wrong

Keep your grievance relating to poor work performance clear:

Step 2: Provide guidance and training

This can be achieved by:

Step 3 - Provide reasonable time to improve

Depending on the job requirements and the improvement needed:

Step 4: Have a follow-up meeting

Step 5: If standard are still not met

Call a meeting with the employee and:

5. Probation Problems

Probation is a testing period for employees, not a free pass to dismiss them.

Employers must:

Guide the new employee
Explain performance expectations
Warn them early if there is a problem with their performance
Provide them with a chance to improve
Allow them to make representations before dismissal

The 2025 Code allows lower thresholds for probation dismissals compared to permanent staff.

6. Incapacity (Illness, Injury, Incompatibility)

There are 3 types of incapacity:

Step 1: Identify the incapacity

Is the employee:

Step 2: Consult with the employee

Ask the employee:

Step 3: Look for alternatives

Examples to consider:

Step 4: If no alternatives exist

Hold a meeting with the employee and keep notes:

7. Retrenchment (Operational Requirements)

The 2025 Code of Good Practice provides clear guidance for small business retrenchments.

Step 1: Give written notice

Explain to the employee(s):

The reasons for retrenchment
Which positions are affected
Timing
Possible alternatives
Proposed severance
Selection criteria (e.g., skills OR LIFO)

Step 2: Consultation

Even a single meeting with employees affected counts.

Discuss the following with them:

Step 3: Final decision

After considering all inputs from employees, make the final decision.

Step 4: Notice of termination

Step 5: Pay severance

Minimum: 1 week’s pay per completed year of service

What Small Businesses Must Remember

Whenever you are engaging with employees on dismissals, performance meetings and/or retrenchment consultation, always keep the following in mind.

You can keep things simple, but it must be fair
Always talk to the employee first
Always listen to their side
Always give reasonable time to fix performance issues
Always keep basic written notes
Dismissal should be a last resort

Should you require any assistance with this process, please contact Welman Attorneys Inc. for a consultation.

Download your FREE guide!

Please provide your details below and download our Dismissal Checklist for Small Businesses in PDF format. This can be printed out and used as a guide.

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5 Surprising Truths in South Africa’s New Dismissal Code

Welman Attorneys — Fri, 19 Dec 2025 14:25:08 +0000

For most people, the thought of being dismissed from a job is a source of profound anxiety. It’s often viewed as an abrupt, one-sided decision where the employer holds all the power.

This perception is fueled by misconceptions about what is and isn’t legally permissible, leading both employees and employers to navigate workplace conflicts with a sense of uncertainty and fear.

However, the legal framework governing dismissals in South Africa is far more nuanced and focused on fairness than many assume.

The new Code of Practice: Dismissal (Gazetted 4 September 2025), which repeals the previous Schedule 8, is built on a foundation of;

It establishes that dismissal should always be the last resort, not the first reaction.

In this post we reveal five of the most impactful and counter-intuitive takeaways from this new code. Understanding these principles is essential for any employee who wants to know their rights and any employer who aims to build a fair, legally compliant, and productive workplace.

1: Discipline is About Correction, Not Punishment

A common belief is that a disciplinary hearing is simply a prelude to punishment. The new Code, however, fundamentally reframes this process. It champions the concept of “corrective or progressive discipline,” where the primary goal is not to penalize an employee but to guide their behaviour and help them meet the required standards.

This approach mandates a system of graduated measures. For minor issues, the process should begin with informal advice and correction. Only for repeated misconduct or more serious infractions should an employer move to formal warnings.

This principle is clearly articulated in the Code:

The purpose of implementing disciplinary processes is corrective. They are primarily a means to correct an employee’s behaviour through graduated disciplinary measures.

Section 6(2), Code of Good Practice: Dismissal (2025)

From a strategic HR perspective, this is more than just a philosophy of fairness; it’s a crucial risk-mitigation strategy. By following a corrective path, an employer creates a clear, documented paper trail demonstrating procedural fairness.

This makes a subsequent dismissal, should it become necessary, far more robust and defensible against a challenge at the CCMA or bargaining council. Improvement, development and guidance is encouraged over fear.

2: Small Businesses Get a Dose of Reality

Legal and procedural codes can often feel disconnected from the realities of running a small business. Think about a barber shop, laundromat or your local butcher for instance.

The new Code directly addresses this by making special considerations for smaller employers, acknowledging that they operate under different constraints than large corporations.

The Code explicitly states that small businesses cannot be expected to have dedicated human resources departments or to engage in the same lengthy, formal processes as their larger counterparts.

It should also be borne in mind that small employers do not have human resource departments staffed by people with skills and experience in these matters.

Section 3(3), Code of Good Practice: Dismissal (2025)

This provision reveals a sophisticated legal balancing act. It shows the law is not a rigid, one-size-fits-all instrument. It balances the core principle of fairness against the need to avoid creating an undue administrative burden that could stifle small business operations.

The standard of fairness remains absolute, but the formality of the procedure is adaptable to the employer’s capacity, ensuring justice is practical.

3: Retrenchment Is a "No-Fault" Dismissal

Losing your job due to retrenchment can feel deeply personal, but the Code provides a powerful and important confirmation.

Dismissal for “operational requirements” – the legal term for retrenchment – is explicitly defined as a “no fault” dismissal. This means the termination is not a reflection of the employee’s conduct, capacity, or performance, but a result of the employer’s own economic, technological, or structural needs.

This distinction is not just semantic. It has profound implications for the employer’s obligations.

Because retrenchment is a “no fault” dismissal and because of its human cost, the Act places particular obligations on an employer, most of which are directed toward ensuring that all possible alternatives to dismissal are explored and that the employees to be dismissed are treated fairly.

Section 22(3), Code of Good Practice: Dismissal (2025)

This framing creates a crucial psychological and procedural shift. While the employee is absolved of fault, the employer’s actions are placed under an intense microscope.

The burden of proof is immense: any failure to genuinely explore alternatives, consult meaningfully, or follow the consultation process can render an otherwise necessary dismissal unfair.

4: The Probation Period Isn't a Wild West

One of the most persistent myths in the workplace is that the probation period is a lawless “Wild West” where an employer can fire a new hire for any reason, or no reason at all. The new Code makes it clear this is not the case.

The purpose of probation, according to the Code, is specific: to give the employer a fair opportunity to evaluate the employee’s performance and suitability for the role. Crucially, it forbids employers from using probation as a tool to simply churn through new staff to avoid the responsibilities of permanent employment.

Even during probation, an employer cannot simply show someone the door. Before a decision to dismiss is made, the employer must give the employee an opportunity to make representations.

While the Code does state in Section 18(2) that the reasons for dismissal during probation can be “less compelling” than for a permanent employee, a fair process must still be followed, ensuring that the decision is tied to the employee’s performance or suitability and is not arbitrary.

5: Participating in an Unprotected Strike May Not Be a Firing Offense

Perhaps the most surprising principle in the Code relates to industrial action. While participating in a strike that does not comply with the Labour Relations Act is defined as misconduct, it does not automatically give an employer the right to dismiss everyone involved.

The Code stipulates that the fairness of a dismissal in this context must be judged on the specific facts of the case. This includes considering whether the strike was a response to “unlawful, unfair or unreasonable conduct by the employer.”

Furthermore, process remains paramount. Before any dismissal can occur, the employer is required to follow clear steps, including issuing a clear, unambiguous ultimatum.

This demonstrates the law’s recognition of power dynamics in the workplace. Even when employees engage in unprotected (and therefore unlawful) conduct, the law still requires an examination of the employer’s own behavior that may have provoked the situation.

It shows that fairness is a two-way street, even in the most contentious scenarios.

A Code Built on Fairness

Ultimately, the Code reframes dismissal not as a tool of authority, but as a failure of a process. It challenges both managers and employees to prioritize communication, documentation, and corrective action as the true foundations of a stable and fair workplace.

It establishes dismissal as the final step in a carefully considered process, to be used only after other corrective measures and alternatives have been properly explored.

Knowing the law prioritizes dialogue and correction, how might that change the way you approach difficult conversations in your own workplace?

Contact us at Welman Attorneys Inc. if you need your companies processes and disciplinary codes reviewed to ensure you comply with the new changes.

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A Disciplinary Hearing is not a Trial

Welman Attorneys — Fri, 19 Dec 2025 13:57:13 +0000

For many employees and managers, the phrase “disciplinary hearing” conjures images of a formal, intimidating courtroom.

We picture complex charge sheets, legal arguments, and a process that feels more like a criminal trial than a workplace meeting. This perception often leads to anxiety, inefficiency, and a focus on procedural technicalities rather than resolving the actual issue at hand.

However, this common view is largely a misunderstanding based on an outdated and overly rigid model. A landmark South African Labour Court judgment, Avril Elizabeth Home for the Mentally Handicapped v CCMA, clarified that the system established by the 1995 Labour Relations Act was designed to be much simpler, more flexible, and focused on dialogue.

In this post we unpack the surprising and commercially critical takeaways from this case that should inform every disciplinary policy and action for companies in South Africa.

Disciplinary Hearing or Criminal Trial?

The 1995 Labour Relations Act (LRA) represented a deliberate and fundamental departure from the ‘criminal justice’ model that previously governed workplace discipline.

That old approach, which mimicked a formal trial, was deemed inefficient, overly complex, and inappropriate for resolving workplace issues. It recognised that managers are not judges and that workplace issues require a more practical and less time consuming approach.

The judgment in the Avril Elizabeth Home case powerfully highlights this shift in philosophy:

The balance struck by the LRA thus recognises not only that managers are not experienced judicial officers, but also that the workplace should not be unduly impeded by onerous procedural requirements.
This change is crucial. It shifts the focus from winning a legal battle to resolving issues efficiently and rationally, without getting bogged down in complex procedures that belong in a courtroom, not a boardroom.

The Old Code of Good Practice was Surprisingly Simple, the new Code confirms

The LRA’s old Code of Good Practice: Dismissal “spelt out in specific terms” what a fair procedure entails, and it is not a long list of rigid rules.

Instead of complex legal requirements, the old Code outlines a straightforward process designed to ensure fairness without being overly formal. Based on the guidelines in Item 4 of the old Code, a fair procedure simply requires the following steps:

Conducting an investigation: The employer should normally investigate to determine if grounds for dismissal exist. Crucially, the Code notes this "does not need to be a formal enquiry."
Notification: The employer must notify the employee of the allegations in a way and language they can reasonably understand.
A chance to respond: The employee must be given an opportunity to state their case in response to the allegations.
Reasonable preparation time: The employee must be given a reasonable amount of time to prepare their response.
Assistance: The employee has the right to be assisted by a trade union representative or a fellow employee.
Communication of the decision: After the process, the employer must communicate the decision that has been taken.

The simplicity of this checklist is intentional. As the court highlighted by referencing international labour standards, the goal is to create and ensure “dialogue and reflection” occurs before a final decision is made.

Each step is merely a tool to facilitate a structured, fair conversation.

The new Code confirms this approach.

The Real Formal Hearing Happens Later (If Needed)

The reason the LRA allows for a simplified internal process is because it establishes a two-step system for ensuring justice. This system is designed to prevent a “duplication of process.”

The internal hearing is an opportunity for dialogue and for the employer to make an initial, rational decision. If the employee disputes a dismissal, the matter can then be referred to the CCMA or a bargaining council.

It is at this second stage, the arbitration, where a more formal process involving evidence and legal standards is applied by an independent third party. In South Africa, by a CCMA commissioner.

The court explained the logic behind this design:

The rules relating to procedural fairness introduced in 1995 do not replicate the criminal justice model of procedural fairness. They recognise that for workers, true justice lies in a right to an expeditious and independent review of the employer’s decision to dismiss…
This means the internal hearing doesn’t have to be perfect or trial-like, because the ultimate check on fairness happens later, at a dedicated and independent forum.

The Old, Strict Rules on 'Bias' Don't Apply

A key procedural challenge in the Avril Elizabeth Home case involved an allegation of bias.

In the internal disciplinary hearing, the chairperson was a subordinate of the manager who initiated the complaint. Under the old “criminal justice” model, this fact could have successfully supported an argument for a “reasonable apprehension of bias,” potentially rendering the entire dismissal procedurally unfair.

However, the Labour Court found that the CCMA commissioner made a material error by applying this strict, outdated standard. The court rejected the argument, effectively stating that the realities of workplace hierarchies do not automatically create impermissible bias in the new, less formal system.

This is a pivotal shift for managers. It means that the mere existence of workplace hierarchies – where a senior manager initiates a complaint and their subordinate chairs the hearing – does not automatically invalidate a process.

The law now prioritizes substance and the ultimate check-and-balance of an independent CCMA arbitration over the rigid, often impractical, procedural purity demanded by the old model.

Do Your Own Policies and Processes Comply?

While the LRA provides for a less formal process, a company can legally bind itself to the old, formal “criminal justice model” through its own documents.

If an employer promises a more elaborate, trial-like procedure, it will be held to that higher standard. This can happen in several ways:

This serves as a critical warning for all employers. It is essential to review your internal documents to ensure they align with the flexible standard set by the LRA. If your policies promise a formal, court-like process, you are legally obligated to provide it, even if the law itself does not demand it. Failing to do so can make an otherwise fair dismissal procedurally unfair.

When was the last time you reviewed your employment contracts and/or disciplinary codes?

From Trial to Dialogue

The legislative shift in South Africa, clarified by judgments like Avril Elizabeth Home, was a deliberate move to transform workplace discipline.

It sought to replace legalistic theatre with a system grounded in rational decision-making, efficiency, and constructive dialogue. The focus is on getting to the substance of an issue fairly, not on perfecting a procedure. By understanding these principles, both employers and employees can engage in disciplinary processes that are less intimidating and more effective.

Knowing that the goal is dialogue and reflection, not a trial, how could your organization better handle difficult conversations about misconduct?

Contact us at Welman Attorneys Inc. if you need any assistance in reviewing your contracts with employees, your disciplinary processes and codes to ensure you do not create a legal trap for your business or company.

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What is Section 77 of the Basic Conditions of Employment Act and How Does It Protect Your Contractual Rights?

Welman Attorneys — Fri, 26 May 2023 12:17:48 +0000

Introduction

If you are an employee in South Africa, you may have heard of the Basic Conditions of Employment Act 75 of 1997 (BCEA), which is a law that regulates the minimum standards of employment, such as working hours, leave, remuneration, termination and more. But did you know that the BCEA also gives you the right to approach the Labour Court directly to enforce your rights under the Act? This is what Section 77 of the BCEA is all about.

Jurisdiction of the Labour Court

Section 77 of the BCEA deals with the jurisdiction of the Labour Court, which is a specialised court that deals with labour disputes and matters.

According to Section 77(1), the Labour Court has exclusive jurisdiction over all matters arising out of the BCEA, except for some offences that are dealt with by other courts or authorities.

This means that if you have a dispute or a claim related to any provision of the BCEA, you can take it to the Labour Court for resolution.

However, Section 77(3) of the BCEA also provides that the Labour Court has concurrent jurisdiction with the civil courts (such as the Magistrate’s Court or the High Court) in matters concerning a contract of employment.

This means that you can choose whether to take your dispute or claim to the Labour Court or a civil court, depending on which one is more convenient or suitable for your case.

Importance to you

Why is this important? Well, because a contract of employment is not only a legal document that sets out the terms and conditions of your employment relationship with your employer, but it also incorporates any basic condition of employment in the BCEA by default.

This means that any right or obligation that you have under the BCEA automatically becomes part of your contract of employment unless it is replaced, varied or excluded by another law, a collective agreement or a more favourable term in your contract.

For example, if your contract of employment does not specify how much annual leave you are entitled to, then you can rely on Section 20 of the BCEA, which states that you are entitled to at least 21 consecutive days of annual leave for every year of employment. This becomes a term of your contract of employment under Section 4 of the BCEA.

Therefore, if your employer refuses to grant you your annual leave or pays you less than your normal wage for it, you can take them to either the Labour Court or a civil court to enforce your right under Section 20 of the BCEA and your contract of employment.

The same applies to any other basic condition of employment in the BCEA, such as overtime pay, sick leave, maternity leave, notice period, severance pay and more.

You can use Section 77(3) of the BCEA to protect your contractual rights and seek remedies from either the Labour Court or a civil court if your employer breaches any provision of the BCEA or your contract of employment.

An example of protection of contractual rights

In the recent Labour Court case of Makgoka v Silverstar Casino (J310/21) [2023] ZALCJHB 135 (21 April 2023) section 77 of the BCEA was considered and relied upon by the Labour Court to find that the Labour Court had the required jurisdiction to adjudicate the employee’s claim.

The case centres around a labour dispute between an employee (KJ Makgoka) and an employer (Silverstar Casino). The employee alleged that the employer breached his contract of employment by changing his employment status from full-time permanent to full-time flexible, which affected his remuneration and benefits.

The employee referred the dispute to the Labour Court, claiming that the employer committed a unilateral change to terms and conditions of employment in terms of section 64(4) of the Labour Relations Act (“LRA”), a breach of section 24(1) of the (LRA), and an unfair labour practice in terms of section 186(2)(a) of the LRA.

Before referring the dispute to the Labour Court, the employee referred a section 64 or unilateral change dispute to the Commission for Conciliation, Mediation and Arbitration (“CCMA”) for conciliation. The employee later withdrew the CCMA referral.

In the Labour Court proceedings, the employer raised two points in limine, challenging the jurisdiction of the Labour Court to hear the dispute. The employer alleged that:

the referral was premature or that the Labour Court lacked jurisdiction to adjudicate the section 64(4) dispute; and
the Labour Court lacked jurisdiction to adjudicate the section 186 dispute.

At the commencement of the proceedings in the Labour Court, the employee withdrew the claims based on section 24(1) and the unfair labour practice in terms of section 186(2)(a), leaving only the unilateral change claim in terms of section 64(4).

Ultimately the Labour Court dismissed the employer’s points in limine, finding that the Labour Court had jurisdiction to hear the contractual claim based on section 77 of the BCEA, and directed the Registrar to enrol the matter for trial.

In its reasoning, the Labour Court submitted the following:

In his statement of claim, the employee alleged that the employer unilaterally changed the terms of his contract of employment with effect from 1 October 2020. Further, the employee alleged that the employer was in breach of the contract of employment and that the employee sought the restoration of the status quo.
In his argument to the Labour Court, the employee argued that the unilateral change dispute is brought in terms of section 77 of the Basic Conditions of Employment Act (“BCEA”).
In the employer’s argument to the Labour Court regarding section 77 of the BCEA, the employer submitted that the matter must be decided based on the pleadings before the Court and that, because there is no reference to section 77 of the BCEA in the employee’s referral, the Labour Court has no jurisdiction to entertain the claim.
In Abrahams v Drake & Scull Facilities Management (SA) (Pty) Ltd and Another (2012) 33 ILJ 1093 (LC) the Labour Court found that a single employee faced with a unilateral change to terms of employment cannot resort to the right to strike, and thus he cannot refer a dispute in terms of section 64(4) of the LRA.
Whilst it is a trite legal principle that each case should be determined based on the pleadings, the employer’s argument that the claim is not based on section 77 of the BCEA is not sustainable.
The fact that there was no specific reference to section 77 of the BCEA did not deprive the Labour Court of jurisdiction to adjudicate the employee’s claim. The Labour Court has the jurisdiction to hear contractual claims and is empowered to make orders of specific performance.

Conclusion:

In conclusion, this case illustrates the importance of understanding the different types of disputes that can arise from employment contracts and the appropriate forums to resolve them.

The employee was able to overcome the employer’s technical objections and secure his right to have his claim heard by the Labour Court based on Section 77 of the BCEA. The outcome of the trial will depend on whether the employee can prove that the employer indeed changed his employment status and 13th cheque entitlement without his consent and in breach of his contract.

This case also shows that employees should be careful when signing new contracts or accepting new terms and conditions, as they may affect their existing rights and benefits.

Employees who are unsure about their contractual rights should seek legal advice before agreeing to any changes.

THIS POST IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY. IT DOES NOT CONSTITUTE LEGAL ADVICE, NOR DOES IT CREATE AN ATTORNEY-CLIENT RELATIONSHIP. INDIVIDUALS INTERESTED IN THE LEGAL TOPICS DISCUSSED IN THIS POST SHOULD CONSULT WITH THEIR LEGAL PRACTITIONER OR CONTACT OUR FIRM.

If you require a consultation, please contact us at 012 348 0000, email us at info@welmanattorneys.co.za or come by our office at 526 Maynard Street, Garsfontein, Pretoria.

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The Constitutional Court’s Clarification on the Use of Replacement Labour during Lockouts

Welman Attorneys — Thu, 04 May 2023 14:54:25 +0000

Introduction

The recent Constitutional Court case of National Union of Metalworkers of South Africa v Trenstar (Pty) Ltd [2023] ZACC 11 has provided clarity on the use of replacement labour during lockouts.

The conflict created by the decisions of Ntimane & others v Agrinet t/a Vetsak (Pty) Ltd (1999) 20 ILJ 896 (LC) and SACCAWU v Sun International (J1951/15) [2015] ZALCJHB 341 on this issue has finally been resolved by the Constitutional Court.

In this case, Trenstar declared a lockout of its employees after failed wage negotiations with NUMSA. The notice of lockout was issued after the employees notified Trenstar of their intention to “suspend” the strike and return to work, but before the employees called a halt to their strike.

Trenstar’s lockout only took effect after the employees suspended their strike and tendered their services to Trenstar. Trenstar proceeded with its lockout and proceeded to hire replacement workers to perform the work of the locked-out employees.

NUMSA challenged this action, arguing that Trenstar’s use of replacement labour was unlawful under the Labour Relations Act. The Constitutional Court agreed with NUMSA and declared Trenstar’s use of replacement labour unlawful.

Background

The Labour Relations Act 66 of 1995 (LRA) provides for the regulation of the relationship between employers and employees, as well as the prevention and resolution of labour disputes.

One of the topics that the LRA addresses are the use of replacement labour during a lockout. A lockout is a collective bargaining tactic used by employers to put pressure on unions during wage negotiations.

It involves the employer preventing employees from accessing the workplace and performing their duties until an agreement is reached.

The Labour Court had initially dismissed NUMSA’s application, finding that Trenstar’s use of replacement labour was lawful.

NUMSA appealed to the Labour Appeal Court, but its appeal was also dismissed. NUMSA then appealed to the Constitutional Court, which declared Trenstar’s use of replacement labour unlawful.

The Constitutional Court's Decision:

The Constitutional Court held that Trenstar’s use of replacement labour was unlawful under the LRA because section 76(1)(b) must be interpreted to confine the use of replacement labour to the duration of the strike.

The Court held that Trenstar’s use of replacement labour after the strike was suspended, and the employees had tendered their services was inconsistent with section 76(1)(b) because the lockout in effect became “offensive” once the strike was halted by the employees.

The Court stated that “subject to the one exception contained in section 76(1)(a), an employer may use replacement labour during a strike.

But subject to the one exception contained in section 76(1)(b), an employer may not use replacement labour during a lock-out”. Section 76(1)(b) states: “An employer may not take into employment any person – for the purpose of performing the work of any employee who is locked out, unless the lockout is in response to a strike.”

The Court’s decision clarifies that an employer is not entitled to use replacement labour to replace locked-out employees after the affected employees have halted their strike and tendered their services back to the employer.

This effectively means that an employer cannot use replacement labour to permanently lock out employees until those employees capitulate to the employer’s demands, or in other words use the lockout as an “offensive” tactic.

The Constitutional Court stated that such a turn of events was inconsistent with the Constitution, particularly when the employee’s constitutional right to strike must curtail the employer’s legislated right to lockout.

Implications of the Decision:

The decision has significant implications for employers and employees. Employers need to ensure that they follow the proper procedures when declaring a lockout.

Further, employers must understand the limitations regarding the use of replacement labour during any lockout. Employers cannot use lockouts to weaken unions or refuse to allow locked-out employees to return to work after they have called a halt to their strike.

Employees, on the other hand, can be reassured that their rights are protected under the LRA.

They can challenge their employer’s use of replacement labour if they believe it is unlawful, and they can seek relief from the Labour Court or the Constitutional Court.

Conclusion:

The NUMSA v Trenstar case provides much-needed clarity on the use of replacement labour during lockouts.

If you require a consultation, please contact us at 012 348 0000, email us at info@www.welmanattorneys.co.za or come by our office at 549 Jacqueline Drive, Garsfontein, Pretoria.

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Transfer of Businesses as a Going Concern: What Business Owners Need to Know

Welman Attorneys — Sat, 22 Apr 2023 09:04:16 +0000

In today’s fast-paced business environment, transfers of businesses as a going concern are becoming increasingly common.

The recent Labour Court judgment [Numsa obo Members and Others v AIH Logistics (Pty) Ltd and Another (D 1112/19) [2023] ZALCD 2 (27 January 2023)] has shed light on what constitutes a bona fide transfer of a business as a going concern in terms of section 197 of the Labour Relations Act. The Court noted that the primary function of section 197 is to protect employees’ rights.

These rights include the right to not be subjected to an unfair labour practice, unfair dismissal and continuity of employment.

The Court considered several key indicators in its judgment. In this blog post, I’ll delve into some of the key takeaways from the Court’s decision, including the importance of the substance of the transaction, the transfer of assets and personnel, and the continuity of business operations.

These indicators are crucial for business owners and legal practitioners to be aware of when considering or advising on transfers of businesses or sections thereof.

The Court was tasked with determining whether a transfer of a section of a business was indeed a bona fide transfer of a business as a going concern as provided for under section 197 of the Labour Relations Act, 66 of 1995.

In coming to its decision, the Court considered several key indicators to assess the transfer.

Substance Above Form

The Court stated, as found by the Constitutional Court in Nehawu v University of Cape Town and Others [2002] ZACC 27 at para 56, that the substance and not the form of the transaction must be interrogated.

In this case, it was known that some of the workers involved in the assembly of motor vehicles were transferred from AIH Logistics (Pty) Ltd (the first respondent) to Blacksuits (Pty) Ltd (the second respondent), but not all workers were transferred. There was no transfer of assets, customers, or suppliers. Also, the second respondent did not own equipment, nor did it lease any from the first respondent.

Lastly, the Court found that the second respondent was not carrying on the same business as the first respondent. The services provided by the second respondent did not result in the production of a quality-controlled motor vehicle.

Transfer of assets and workers

Although the Court stated that “not all workers… or assets were transferred”, this statement should not be interpreted as suggesting that every asset and worker must be transferred from the previous employer to the new one.

The Court noted that in a legitimate transfer of business transaction, what is transferred are the assets and personnel that are crucial to the way the business was run by the previous owner. Without transferring the tools and resources necessary to carry out the work, there can be no bona fide transfer of the business as a going concern.

Continuity of the business operations:

The Court scrutinised the intended role of the second respondent.

In its argument, the first respondent claimed that it searched for service providers to address its human resource and labour management issues, enforce the use of personal protective equipment, reduce absenteeism and improve productivity by having backup staff.

The first respondent asserted that it retained its team leaders as part of its staff because it was responsible for overseeing the assembly process and ensuring compliance with safety certifications, among other things.

The Court stated, as found by the Constitutional Court in Aviation Union of SA and Another v SAA (Pty) Ltd and Others (2011) 32 ILJ 2861 (CC) at para 108, that a distinction must be made between the transfer of a business as a going concern and the transfer of the right to provide an outsourced service.

The Court found that the evidence suggested the transfer from the first respondent to the second respondent was not a transfer of a portion of the business as a going concern [Severable, yes, as {the} body is from a head, but not as a going concern (para 19)]. The work performed by the applicants, which was at the core of the assembly process, was not separable from the overall task of producing motor vehicles.

The first respondent retained control over the applicants and merely identified a “service” that the second respondent could provide to it. In this case, the “services” that the second respondent provided fall short of the requirements of section 197.

Therefore, based on the evidence, the Court concluded that the second respondent is not an independent economic entity capable of operating as a going concern.

In concluding its judgment, the Court stated:

“[20]… the second respondent structurally viewed could not achieve those results [increase in productivity] as a separate, excisable business. Without its own machines, tools, premises, safety certification, team leaders, customers, and ability to issue operational instructions, the second respondent’s laudable role in achieving better results for the first respondent is akin to the work of an HR/IR consultancy.”

“[21] Considered properly, the purpose of the transaction was to shift employees to another entity, not to shift work processes there, with the employees following behind. The new employer is not in possession of a going concern after the transfer but rather in possession of the right to perform certain HR time management and disciplinary functions, which is brought into focus when one considers the personnel the second respondent brings to the table; labour lawyers, labour brokers and no-one with assembly-line experience.”

In conclusion, the issues discussed herein are some of the key indicators that the Court considered in determining whether a transfer of a section of a business was a bona fide transfer as a going concern. Business owners and legal practitioners should be aware of these indicators when considering or advising on transfers of businesses or sections thereof.

If you require a consultation, please contact us at 012 881 0072, email us at info@welmanattorneys.co.za or come by our office at 526 Maynard Street, Garsfontein, Pretoria.

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