Section 23 of the Constitution of the Republic of South Africa, 1996 guarantees everyone the right to fair labour practices. The reference to "everyone" means every person in the Republic of South Africa. All legislation that regulates employment law in line with this right is therefore applicable to foreign nationals working in South Africa.

The choice of law is determined by the jurisdiction in which the operation to which the South African national is providing services is situated.

See Question 30, Foreign nationals.

Employee/worker. An employee is any person excluding an independent contractor who works for another person or for the state and who receives or is entitled to receive remuneration, and any other person who in any manner assists in carrying on or conducting the business of an employer (section 213, Labour Relations Act, 1995 (LRA)).

Independent contractor/self-employed. South African law distinguishes between employees and independent contractors. When considering whether an individual is an employee or an independent contractor, the courts consider the substance of the agreement over its form and make a determination based on the dominant impression test gained from considering a wide range of factors. Factors considered include the person's control over the other person's productive capacity and whether the:

Employees are entitled to the benefits and protections provided by South African labour legislation. Independent contractors are governed by the laws of contract and the specific contract under which they are working. As a result, they are not entitled to the benefits and protections afforded to employees by labour legislation.

There are no maximum time periods during which a person can be engaged as an employee or an independent contractor.

There is, however, a distinction between indefinite contracts of employment and fixed-term contracts of employment.

Employees on fixed-term contracts earning below the minimum threshold stipulated in the Basic Conditions of Employment Act 75 of 1997 (BCEA) (which is currently ZAR205,433.30) may have a claim for indefinite employment if their contracts are renewed for more than three months or terminated at the end of three months to avoid the deeming provisions of indefinite employment. This will not apply if there is a justifiable reason for extending the fixed term contract beyond three months, such as temporary replacement of an employee who is absent from work, employment on account of an increase in the volume of work not expected to endure beyond 12 months and employment for seasonal work.

Employees who earn above the threshold can be employed for longer than three months if the employment is for a specified duration or for a specific purpose. However, constant renewal of such contracts may give rise to a claim for a legitimate expectation of indefinite employment,

Employment Tax Incentive Act, 26 of 2013 potentially provides employers with a tax rebate for hiring workers between 18 and 29 years of age.

The Employment Services Act, 4 of 2014 (ESA) provides for regulations to be published establishing employment schemes aimed at promoting the employment of young people and other vulnerable categories of people. Draft regulations were published in December 2018 but they have not been made final.

UIF. Under the Unemployment Insurance Act, 63 of 2001 and the Unemployment Insurance Contributions Act, 4 of 2002 employers are required to register all employees with the Unemployment Insurance Fund (UIF). The following categories of employee are exempt from this requirement:

Employers must make a monthly payment to the UIF on behalf of their employees, which consists of both:

COIDA. Under the Compensation for Occupational Injuries and Diseases Act, 130 of 1993 (COIDA), an employer must register themselves and all of their employees with the Compensation Commissioner. They must provide the Commissioner with an estimate of the number of employees they will employ in the upcoming financial year, and how much they will be paid. At the end of each financial year the employer must complete a return of earnings report, which must be submitted to the Commissioner.

SARS. Every employer must register with the South African Revenue Services (SARS) for the purposes of the taxation of employees. Employers must withhold a percentage of the employees' monthly salary, which must be paid to SARS within seven days after each month end. Employers must also complete an annual reconciliation and provide this to SARS.

ESA. The ESA makes provision that regulations can be published requiring employers to report on vacancies and the filling of positions. The regulations were published for public commentary in December 2018 but remain in draft format.

Employers can access an employee's credit and criminal records with their consent. Under the Employment Equity Act, 55 of 1998 (EEA) employers (and prospective employers) are prohibited from discriminating against employees on unfair grounds. As a result, employers should be mindful about what information they seek out. For example, employees are not generally obliged to disclose HIV status or pregnancy.

Procedure for obtaining approval. There are a number of work visas that a foreign national can potentially obtain in order to work lawfully in South Africa. An employee can apply for one of the following types of work visa:

Other required documents to support the visa application include:

An employer can apply for a corporate visa, which allows them to hire a number of foreign national employees for a limited period of time. The employer will need to both:

Expiry and renewal. ·General work visas remain valid for the duration of the contract of employment or for a period not exceeding five years. A general work permit will lapse if within six months of issuance and if every year thereafter the holder fails to submit satisfactory proof to the Director-General of Home Affairs that he/she is still employed, along with proof of the terms and conditions of the job and the job description.

Critical skills visas are issued for a period not exceeding five years and Intra-company transfer visas can only be issued for a period not exceeding four years and cannot be renewed or extended.

Cost. The cost of a work visa is currently ZAR1,520 (the cost is the same for all the types of work visa).

Time frame. The procedure to process a visa application usually takes a minimum of eight to ten weeks.

Sanctions. Section 49(3) of the Immigration Act, 13 of 2002 provides that anyone who knowingly employs an illegal foreign national will be guilty of an offence and liable, on conviction, to a fine or to imprisonment not exceeding one year. The Immigration Act does not expressly provide for maximum fines, but these are generally applied similarly to administrative fines, which provide for a maximum fine of ZAR8,000. An employee whose work permit has expired cannot carry on working for their employer. This does not, however, give employers an automatic right to immediately terminate the employment relationship without following due process provided for in terms of the South African labour legislation. Such employees enjoy the same protections under the legislation, regardless of their legal status.

An employee who works without the correct visa risks detention and deportation. Whether the employee did so knowingly or not does not materially have an impact on the outcome. It is always best practice to apply for an extension of a work permit at least 90 days before it expires to avoid instances where an employee is unable to render services to an employer by virtue of the expiry of the work permit.

Children under the age of 15 or under the minimum school-leaving age (which is 15 or the end of the ninth grade, whichever comes first) cannot be employed. There are no additional requirements for a manager or director.

There are no statutorily prescribed nationality restrictions.

The following persons are disqualified from being the directors of a company:

All employers who employ more than five employees are required by law to set out in writing certain particulars in respect of employees who work 24 hours or more per month. These particulars include details on:

There are additionally certain employment contracts which are required by various statutes to be in writing.

There are a number of terms, relating to basic conditions of employment, which are implied by law into the contract of any employee who earns below the statutory earnings threshold. Further, certain collective agreements or sectoral determinations can imply terms into employment contracts.

Collective agreements are automatically binding upon the parties to an employment contract.

An employer cannot unilaterally change the terms and conditions of employment: the agreement of the employee is required. The employee's agreement should be recorded in writing.

The National Minimum Wage Act, No 9 of 2018 (NMW) introduced a national minimum wage in South Africa. The effect of this is that every worker in respect of whom the NMW applies is entitled to be paid at least the national minimum wage by his or her employer. Employers can apply for an exemption from paying the national minimum wage in certain circumstances.

Non-compliance with the NMW can result in fines being imposed on the employer or referrals for claims for underpayment to the CCMA or appropriate court.

Section 32 of the BCEA requires payment to be made in South African rands, and must be in cash, by cheque or by direct deposit. Payment must be made seven days after the end of the period for which remuneration is payable.

Working hours are regulated by Chapter 2 of the BCEA. The provisions of Chapter 2 only apply to employees earning less than the earnings threshold, currently ZAR205,433.30 per annum. Employees cannot opt out of these provisions.

Maximum ordinary working hours are:

Overtime can only be worked by agreement with the employee and is limited to ten hours per week.

Work on Sundays and Public Holidays can take place only with the employee's agreement.

Arrangements to limit overtime, such as compressed working hours and the averaging of working hours, are subject to the employee's agreement.

Employees are entitled to a full hour lunch break after working continuously for five hours, or a 30-minute lunch break by agreement. Employees are further entitled to a 12-hour daily break between shifts, and a 36-hour weekly break, which should fall over a Sunday unless otherwise agreed.

Shift workers are not generally treated differently from normal employees. Where night work is undertaken (between 6pm to 6am), employees must be compensated with a shift allowance or reduction of working hours, and transport must be available between the employee's home and the workplace.

In a cycle of 12 months, an employee is entitled to at least 21 consecutive days' annual leave on full remuneration. By agreement, annual leave can alternatively accrue at a minimum of one hour/day per 17 hours/days worked.

Public holidays are regulated by the Public Holidays Act, 36 of 1994. There are 12 public holidays in South Africa. If a public holiday falls on a Sunday, the following Monday is also a public holiday. Public holidays are not included in the leave entitlement: an employee must be paid for these days over and above their annual leave. An employee must be paid at least double their usual rate for working on a public holiday.

Section 22 of the Basic Conditions of Employment Act, 75 of 1997 (BCEA) regulates sick leave. A sick leave cycle is 36 months from the commencement of employment or the end of the previous cycle. Employees are not entitled to take unpaid sick leave (for the employees' entitlement to paid sick leave, see below, Entitlement to paid time off).

During sick leave an employee is entitled to paid sick leave equal to the number of days that he would usually have worked for a duration of up to six weeks. However, during the first six months of employment, an employee is only entitled to one day per 26 days worked.

Paid sick leave cannot be recovered from the state. However, time off resulting from injury on duty is not considered as sick leave and is dealt with under the Compensation for Occupational Injuries and Diseases Act, 130 of 1993 (COIDA). Employers may be compensated by the Compensation Commissioner for payments made to employees under this legislation.

There is a right to four consecutive months' unpaid maternity leave. This can commence at any time from four weeks before the expected date of delivery or earlier if a certified medical practitioner deems it necessary for the employee's health to commence leave at an earlier date. Additionally, an employee cannot work for six weeks after the birth, regardless of whether the child is a stillborn or not. An employment contract can provide more favourable maternity leave than these provisions.

An employee who is a parent but who is not the primary care giver (male or female) is entitled to at least ten consecutive days unpaid parental leave from the day that the child is born or in the case of an adoption, the date on which the adoption order is granted or on the day the child is placed in the care of a prospective adoptive parent, whichever occurs first. In the event that the employer does not provide for payment of salaries during this period, the parent would be entitled to some benefits which will be determined by the Minister of Labour under the Unemployment Insurance Act.

An employee who is a commissioning parent in a surrogate motherhood agreement is, subject to section 25C(6) of the BCEA, entitled to commissioning parental leave of at least ten weeks consecutively. Alternatively, he/she is entitled to the parental leave referred above, depending on whether or not he/she is the primary care giver. An employee can commence commissioning parental leave on the date a child is born as a result of a surrogate motherhood agreement.

An employee who is an adoptive parent of a child below the age of two is entitled to adoption leave of at least ten weeks consecutively, provided that his/her spouse/partner does not qualify for or has not been granted adoption leave and will be the primary carer of the child during the adopted leave period. An employee can commence adoption leave on the date that the adoption order is granted or that a child is placed in the care of a prospective adoptive parent by a competent court, pending the finalisation of an adoption order in respect of that child, whichever date occurs first.

Carers, including those of disabled children and adult dependants, are not provided for under South African labour legislation.

The period of employment has an effect on the statutorily prescribed minimum notice periods which are required for termination of an employment contract. The entitlement to family responsibility leave arises after the employee has been employed for a period of four months, as does the entitlement to be paid the value of accrued annual leave on termination of employment.

For the purposes of determining the length of employment for any provision of the BCEA, previous employment with the same employer must be taken into account if the break between the periods of employment is less than one year.

Employees retain their length of service and conditions of employment on a transfer of a business, or part of it, as a going concern.

The expiry of a fixed-term contract does not constitute a dismissal. To avoid the abuse of fixed-term contracts, employees who had a reasonable expectation of renewing a fixed-term contract can claim that non-renewal constitutes dismissal. Restrictions are also in place for the use of temporary employees and agency workers that earn below the statutory earnings threshold, currently ZAR205,433.30 per annum. These restrictions are explained below.

Employees on fixed-term contracts are considered permanent after three months, unless there is a justifiable reason for fixing the term of the contract beyond three months in respect of employees earning below the threshold. A non-exhaustive list of justifications is provided in section 198B of the LRA. After three months, temporary workers are also entitled to be treated no less favourably than their permanent counterparts at the employer, unless there is a justifiable reason for different treatment.

Agency workers are considered to also be employed by the client they are rendering services to for purposes of the LRA once they have provided those services for three consecutive months. This generally provides protection against unfair dismissal. After three months, agency workers are also entitled to be treated no less favourably than their counterparts at the client, unless there is a justifiable reason for different treatment.

Part-time employees are entitled to be treated on the whole not less favourably than full-time employees, unless there is a justifiable reason for different treatment.

It is accepted that an employee may have multiple employers at the same time, particularly where an employee is providing services to other companies within a group.

There are no statutory rights associated with the right for employees to request to work flexibly.

Employees have a right to privacy, which prohibits an employer from intercepting, monitoring or acquiring an employee's private communication without the employee's knowledge, unless the employer has the employee's consent to do so, or if the breach is justified by necessity. The Protection of Personal Information Act, 2013 (POPI) provides extensive protection in this regard, but its substantive provisions are not yet in force.

At the time of writing, the President of the Republic of South Africa was requested to sign the remaining provisions of POPI into full force by 1 April 2020 however this has as yet not been signed into law These provisions will establish minimum requirements for lawful processing of information with which all persons will be required to comply.

Any organisation which is either domiciled in or processes personal information in South Africa, must comply with POPI. Once it comes into effect, all persons will have one year to comply with the provisions and a failure to do so may result in substantive penalties such as:

An employer is under an obligation not to access any personal data or information of its employees unless it is justified to do so by either:

The Employment Equity Act, 55 of 1998 (EEA) protects employees from unfair discrimination on various grounds including, but not limited to:

Harassment is viewed as unfair discrimination and as a result is protected against by the EEA.

The Protected Disclosures Act, 26 of 2000 was passed to protect whistle-blowers. Section 3 of the Act provides that any employee who makes a protected disclosure cannot then be subjected to an occupational detriment. A protected disclosure includes a disclosure made in good faith to a legal practitioner, employer or various bodies specified in the Act (for example, the Public Protector).

The LRA further specifies that any dismissal made as a result of making a protected disclosure will be automatically unfair. If the employer is found to be liable, an employee would be entitled to maximum compensation equivalent to 24 months' remuneration, alternatively reinstatement with back pay from the date of dismissal.

There are minimum notice periods for termination of the employment contract either by the employer or employee. The duration of the notice period that each party must provide depends upon the employee's length of service:

An employer must pay severance pay of at least one week's remuneration for each completed year of service to the employee if the employee is dismissed for operational reasons, provided that the employee did not unreasonably refuse alternative employment. Severance pay is subject to a consultation process. No severance pay is payable for dismissal for other reasons.

No filings are required, but the dismissal must be both procedurally and substantively fair (see Question 21, Protection against dismissal).

An employee can be dismissed on the basis of misconduct, incapacity or for operational reasons, that is, retrenchment or redundancy.

The dismissal must be procedurally and substantively fair. This applies to all employees, regardless of the length of service or any other criteria. Procedural fairness requires that the employee must be:

Substantive fairness requires that there must be a good reason (cause) for the dismissal. Dismissal for misconduct is normally justified by the employee's serious misconduct (such as theft, gross negligence or assault). See Question 23 for the reasons for dismissals due to operational requirements (redundancy).

There are no categories of protected employees.

The Labour Relations Act of 1995 (LRA) has made provision for employees to challenge unfair dismissals and other unfair practices at private or statutory dispute-resolution forums. Such disputes may, by agreement, be dealt with via private (non-statutory) dispute-resolution forums such as the TOKISO panel: www.tokiso.co.za.

There are also a number of statutory dispute-resolution forums established by the LRA. These include the:

The process that must be followed when there is a claim of an unfair dismissal is that:

Disputes that go to the Labour Court instead of arbitration usually relate to matters such as multiple retrenchment, strike dismissals or automatically unfair dismissals.

All CCMA and Labour Court services are free and funded by the state so there are no legal or administration fees and the costs that are incurred usually relate to each party paying for their own legal representation.

When dismissing on the grounds of its operational requirements (redundancies), the employer must show that it terminated employment as a result of economic, technological, structural or similar needs, and that termination was the only reasonable option.

Section 189 of the LRA and the Code of Good Practice on Operational Requirements provide that, before effecting a dismissal for operational requirements, an employer must follow a consultation process which must include (among other things) attempts to avoid the dismissal, minimise the number of dismissals and mitigate the adverse effects of the dismissal. There must be an attempt from both parties to reach consensus. The persons or bodies that an employer is required to consult with, and the topics which must be consulted on, are specified by legislation.

In the case of large scale retrenchments (where dismissal of 10% or more are contemplated by employers who employ at least 200 employees), employers are required to have regard to section 189A of the LRA.

See Question 20, Severance payments.

There are additional requirements which relate to large-scale dismissals (which are defined according to a staggered system measuring the proportion of dismissed employees to total workforce). Prior to giving notice of dismissal, there must be a referral, either to facilitation or conciliation, to the Commission for Conciliation, Mediation and Arbitration (CCMA). Facilitation is a process where a CCMA commissioner presides over the consultation meetings and endeavours to facilitate consensus between the parties. Conciliation is a process where the commissioner attempts to encourage the parties to a dispute to agree to a settlement. After the prescribed time periods, employees can refer a dispute regarding substantive fairness to the Labour Court, or strike. Procedural fairness is challenged only by separate motion proceedings.

Employees are not entitled to management representation.

Employees are entitled to elect representatives who are able to represent them in grievance and disciplinary hearings and monitor and report the employer's compliance with labour legislation.

Trade unions are entitled to certain organisational rights if they are sufficiently representative (generally, they comprise 30% of employees). Collective bargaining is voluntary, and unions sometimes have to strike to compel employers to bargain with them.

Employees retain a number of rights if an employer undergoes business rescue proceedings. Employees are additionally entitled to be consulted by an employer in the case of redundancies.

Employee consent or consultation is not required for mergers, acquisitions or any other similar transactions.

If the consultation process is not followed in the case of redundancies, the matter can be referred by a party for arbitration or to the Labour Court, depending upon the number of employees involved. It can also be an option for the employees to embark upon strike action, depending on the circumstances.

Unless the issue is one that can be referred to arbitration or adjudication, employees can strike to prevent proposals by management going ahead (for which consultation is not required).

Section 197(2) of the Labour Relations Act, 66 of 1995 (LRA) provides that in the case of a transfer of a business (or part of a business) as a going concern, the new employer is substituted in the place of the old employer. All rights and obligations of the employment contract are automatically transferred to the new employer and employees' length of service must be recognised.

Section 187(1)(g) of the LRA provides that a dismissal related to a transfer of business is automatically unfair. However, the new employer can dismiss on the ground of its operational requirements after the transfer.

Under section 197(3) of the LRA a new employer can employ workers on terms and conditions that are different from the old employer, provided that these terms and conditions are, on the whole, not less favourable. The new employer can only amend conditions of employment by agreement with the employees.

It is a well-established principle in South African law that an employer is vicariously liable for the negligent act of his/her employee or agent, when the employee or agent acts negligently while in the course and scope of their employment.

Under the common law employers may be held liable for conduct by their employees which falls within the course and scope of their employment. In addition, section 60 of the Employment Equity Act, 55 of 1998 makes an employer liable for a contravention of the Act by their employees if the breach was reported to the employer and they failed to take the necessary steps to eliminate the breach.

Once a sequestration order has been granted, all employment contracts are suspended with the result that employees are under no duty to render services and have no entitlement to remuneration. Employees can make a claim for any unpaid monies due.

Employees can submit a limited claim to the Unemployment Insurance Fund.

The safety of the workplace is regulated by the Occupational Health and Safety Act, 85 of 1993. Employers have a general duty to provide a workplace that is safe and without risk to the health of its employees as far as is reasonably practicable. This includes the mitigation of risks and hazards that the employer has identified, as well as training and informing employees about safe conduct.

Detailed obligations on the employer also exist based on the industry the employer operates in (for example, the mining sector in particular is very strictly regulated).

Individuals and companies that are not "tax residents" in South Africa (a term defined in section 1 of the South African Income Tax Act, 58 of 1962 (SAITA), see below) are taxed on a source basis, subject to any relief provided by an applicable double taxation agreement. In relation to services, the "source" is typically where the services are rendered, (and so an employee not tax resident in South Africa who provides services in South Africa will be subject to tax on a source basis).

For tax purposes, "tax resident" is defined in section 1 of SAITA as a natural person that is either:

Under recent amendments to the SAITA, some South African tax residents who render services outside of South Africa within an employment context (excluding independent contractors or self-employed persons) for more than 183 days may lose out on the benefit of previous tax exemptions (effective 1 March 2020).

The exemption will now only apply on the first ZAR1 million rand earned while working outside the country and only to the extent that it was not taxed by the other country's tax administration.

In South Africa income is taxed on a progressive scale. The minimum annual salary required for an employee to be liable for income tax is currently ZAR79,000.

The rates of income tax are charged as follows (for tax year 2020, from 1 March 2019 to 28 February 2020):

Companies, small businesses generating taxable income above ZAR79,000 and personal service providers are all liable for tax.

Companies are liable for 28% of their income made in that financial year, personal service providers and foreign resident companies which earn their income from a source in South Africa are taxed at 33%.

Small businesses are taxed at the following rates:

Employees and employers must contribute towards the Unemployment Insurance Fund (see Question 3, Filings).

Under the Skills Development Levies Act, 9 of 1999, companies with a payroll of more than ZAR500,000 per annum must contribute 1% of their payroll per month to the South African Revenue Services as a contribution towards the sector education and training authority in their jurisdiction.

Both contractual and discretionary bonuses are a common feature of employment contracts in South Africa.

While an employer may exercise discretion when granting a bonus, that discretion must be exercised fairly.

Unless there is an express agreement to the contrary, the employer owns the IP rights.

While an employee is employed, the employer can require an employee to disclose any interests or business activities that they undertake outside of their employment and prohibit such activities. Employers do not need to pay employees separately for these restrictions to be enforceable.

A restraint of trade clause in an employment contract can be enforceable where the employer has a proprietary interest that requires protection, and that interest outweighs the right of the employee to work in his chosen profession. An employee who seeks to set a restraint of trade aside has the onus of proving that it is unreasonable and contrary to public policy. Ex-employees can be restrained for a limited time usually between six and 12 months, and in a specific area, from conducting activities such as soliciting clients, suppliers or employees, or engaging in activities in unlawful competition with the previous employer. Employers do not need to pay employees separately for these restrictions to be enforceable.

Relocation benefits are stipulated either in the employment contract or relocation policy and are at the discretion of the employer. An employee is bound by the terms stipulated in the contract of employment and would have difficulty arguing against its reasonableness once the contract is signed. In the absence of a contractual term or policy on relocation, employees can reasonably argue against mobility/relocation especially relocation to a different province or another country. Relocation costs/allowances are usually stipulated in the employer's policy. It is normal for employers to provide assistance for obtaining the necessary visa/work permits.

There are no current proposals to reform employment law in South Africa.