Labour Law South Africa

Labour Law and Employment Contracts in South Africa

Labour law in South Africa developed a lot from the original Industrial Conciliation Act of the early 1900s and became one of the first areas of law to undergo major changes after the 1994 election. The Labour Relations Act of 1995 marked a watershed moment in labour history. It was significantly amended in 2002 to address the changing employment relations in the country.

Apart from the Labour Relations Act, the Occupational Health & Safety Act of 1992, Compensation for Occupational Injuries & Diseases Act of 1993, Employment Equity Act of 1998, Basic Conditions of Employment Act of 1997 (BCEA) and the amended Basic Conditions of Employment Act of 2002, in addition to the Skills Development Act of 1998, and Unemployment Insurance Act of 2001 govern labour law in South Africa. Moreover, South Africa’s labour law has several sources, including legislation, common law, collective agreements and judicial precedent, in addition to legal reports.

The above acts cover employees working inside and outside of South Africa and are applicable to the employees in the country, irrespective of their nationalities or the nationalities of the employers. The above acts covering labour law in South Africa are supported by the NEDLAC Statutory Codes of Practice and may also be supported by other codes of practice. Although the codes of practice are not directly legally binding, should there be disputes in a specific industry between an employer and employee/s, the Court will also review and consider the codes of practice. Collective agreements are enforceable to ensure that negotiations between organised labour and employers can be binding.

The Importance of Employment Contracts in South Africa

The employment contract forms an integral part of labour law in South Africa. Though a written contract of employment is recommended, it is unnecessary for a valid employment relationship to exist. It is, however, important to note that the BCEA makes it necessary for the employer to provide the employee with written particulars upon commencement of employment to create confidence in the employment relationship and to protect the employee against exploitation. As such, the employment contract should be created early on as it will not only protect the employee, but ensure that the employee understands the employer’s disciplinary rules. The employment contract binds both parties legally and should include details regarding the start of employment, termination of employment and payment aspects.

The BCEA describes the written details that should be included in such a contract as follows:

  • Employer’s name and address.
  • Name of the employee.
  • Employee occupation and job description.
  • Place of work.
  • The date on which the employment starts.


The contract should also stipulate particulars regarding the ordinary work hours and days, in addition to the wage and how it is calculated, rates regarding overtime, and any other payments relevant to the employment relationship. It is furthermore necessary to indicate the date upon which wage payment can be expected, deductions from the earnings, number of leave days to which the employee is entitled and the type of leave, termination notice period, bargaining council codes governing the relationship, and documents forming part of the employment agreement.

There are basically fixed term and indefinite term employment contracts. The first refers to employment agreements where the duration of employment is clearly stated and termination of the agreement cannot be made during the employment period, unless there is a valid and legally allowable reason. The latter refers to an employment contract where the ending date of the contract is not stipulated. The agreement is in place until it is terminated by means of reasonable notice from one of the parties – when one of the parties dies, the employer becomes insolvent, employee retires, or one of the parties choose to end the agreement because of a fundamental breach in the agreement.

Contact us at or on 011 234 2125 for professional legal advice and assistance regarding any aspects of labour law in South Africa including the reviewing and drafting of employment contracts.


NB this article is for information purposes only and does not constitute legal advice. You are advised to consult with us before using/relying on this information.

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