Labour Law

Chapter 4

M IN IM UM S TAN DA RD S
L E G I S L AT I O N A N D O T H E R
SO UR CE S OF TER MS A ND
C ON DITIONS OF
EMPL OYMEN T
 Key aspects of this topic include:
• Dual Focus of Modern Labour Law: Modern labour law is designed to ensure
Introduction – the employee prosperity while balancing the economic power between employer and
employee.
• Legislative Cornerstones:
different sources of • National Minimum Wage Act (NMWA): This act regulates the minimum
terms and conditions payments that employers must give their employees. It came into operation on
January 1, 2019, with the goal of improving wages for the lowest-paid workers
of employment and protecting them from unreasonably low wages. The NMWA applies to all
workers and employers.
Study par 4.1 of the • Basic Conditions of Employment Act (BCEA): This act regulates basic conditions
of employment beyond minimum pay. The BCEA allows for "ministerial
prescribed book. determinations" and "sectoral determinations" to promote specific minimum
employment standards across different economic sectors.
• Fair Terms Promotion: The Labour Relations Act (LRA) promotes fair terms and
conditions of employment through the protection of freedom of association and
collective bargaining.
• Interaction of Various Sources: An employee's terms and conditions are
determined by the interaction of legislation, ministerial and sectoral
determinations, employment contracts and collective agreements.
• Employee Information: Section 29 of the BCEA mandates employers to provide
written particulars to employees at the commencement of employment.
• Minimum Notice Period: Section 37 of the BCEA establishes minimum notice
periods, which depend on the employee's length of service, while allowing for
agreements on longer periods.
• BCEA's Immutability: Employers and employees cannot opt out of the BCEA
through employment contracts.
Conti…

Ministerial Authority: The Minister of Employment and Labour holds powers to make determinations, and
employers/employees can apply for Ministerial determinations for specific employee categories per Section 50.

Applicability of the BCEA or sectoral determination.

Factors for Determining Terms and Conditions: Several Existence of a bargaining council collective agreement.
factors should be considered when determining an Presence of an enterprise or plant-level collective agreement.
employee's actual terms and conditions of employment: Potential conflicts between the employment contract, the BCEA and
collective agreements.

Employee Protection: Section 78 of the BCEA protects employees who report an employer's failure to comply with
the Act through a trade union, representative or labour inspector.
4.2.1 The goals of the National Minimum Wage Act 9 of
2018 (NMWA) are as follows:

• The NMWA came into operation on January 1, 2019.

• One goal of the NMWA is to improve the wages of the lowest paid workers and protect workers from unreasonably low wages.

• The NMWA seeks to achieve this through a combination of:

o Prescribing a national minimum wage.

o Prohibiting employers from taking steps (such as a reduction of working hours) to undermine its effectiveness.

o Providing, in general, for the overriding effect of the NMWA in relation to a contract of employment, collective agreement, or sectoral
determination.

o Providing for very limited exemptions to employers from the obligation to pay the minimum wage.

o Establishing a National Minimum Wage Commission (NMW Commission) whose responsibilities include annual reviews of the level of the NMW
and recommendations to the Minister of Employment and Labour about adjustments to it. The NMW Commission also has important r esponsibilities
in terms of the BCEA, notably to investigate and make recommendations to the Minister of Employment and Labour about the prom ulgation of
sectoral determinations in terms of that Act.
 4.3.2.2 The scope of the NMWA
Study par 4.2.2 of the prescribed book.

• The scope of the National Minimum Wage Act (NMWA) declares that the Act applies 'to all workers and their employers'.

• Section 2 of the NMWA declares that the Act applies to all workers and their employers except:

• members of the South African National Defence Force

• members of the National Intelligence Agency

• a 'volunteer,' defined as someone who performs work for another person and who does not receive, or is not entitled to receiv e, any
remuneration for their services

• This provision is included for at least two reasons:

1. To show the application of the concept of 'worker' as defined in the LRA, the BCEA and the Employment Equity Act 55 of 1998 ( EEA). The
NMWA now introduces the word 'employee' although the concepts 'employee' and 'worker' might be different, or whether the empl oyer
contemplated and drafted by the NMWA will apply to independent contractors in chapter three, these arguments arose predominan tly in all
labour arguments.

2. To address the question of broad application of section 23(1) of the Constitution.

The broad scope of the NMWA has several implications:

Labor Inclusivity
Legal
Relations and Fairness
Protections
Clarity
 The provisions of the NMWA
Study par 4.2.3 of the prescribed book.

• The provisions of the NMWA include the following:

• In terms of section 4(1) of the NMWA read with item 1 of Schedule 1 to the Act, the NMW has been set at R25.42 per hour with effect from 1 March 2023. This
translates, for a person who works eight hours a day on five days of the week, to a monthly wage of around R4 400. Since March 2023, this minimum wage also applies
to farmworkers and domestic workers (prior to March 2023 a lower minimum wage applied to them).

• The minimum wage for workers employed in expanded public works programmes is R13,97 per hour.

• Learners in terms of learnership agreements concluded in terms of the Skills Development Act 97 of 1998 are entitled to a sliding scale of weekly allowances as
prescribed from time to time in terms of the NMWA.

• Section 4(4) to 4(7) of the NMWA provide clear rights and obligations on workers and employers relating to payment of the NMW:

• Every worker is entitled to a wage no less than the NMW, subject to the exceptions mentioned.

• Every employer must pay wages to its workers that are not less than the NMW, again subject to the exceptions.

• The payment of the NMW cannot be waived.

Conti…
• The NMW takes precedent over any contrary provision in a contract, collective agreement, sectoral determination or law, subje ct to the exceptions
mentioned above.

• The NMW must constitute a term of the worker's contract unless the contract, an applicable collective agreement, or applicable sectoral determination is
more favourable to the worker in which case effect is given to the more favourable wage.

• Section 5(1) excludes the following from the minimum wage:

• any payment made to enable a worker to work, such as transport, equipment, tool, food or accommodation allowances, unless a sectoral determination
provides otherwise

• any payment in kind, including board and accommodation, unless a sectoral determination provides otherwise

• gratuities, including bonuses, gifts or tips; and

• any other prescribed category of payment

• Please note that this list does not exclude payment on the basis of commission – this means that in determining whether an employer is complying with its
obligation to pay the minimum wage, both basic salary and commission may be taken into consideration (See Atlas finance(Pty)Ltd v CCMA and
Others(2022).

• Continue reading Section 5(2) and (3) of the NWMA….

4.2.4 The interaction between the NMWA and other sources of terms and conditions of employment in relation
to the level of wages:

• The interaction between the NMWA and any applicable legislation, the NMWA and the BCEA, sectoral
determinations, collective agreements, and contracts of employment.

• The NMWA overrides any contract, collective agreement, sectoral determination or other
law that prescribes a wage less than the NMW.

• The NMWA doesn't prevent an employee or applicant from stipulating for a higher wage.

• It is simple to reconcile the above sources, but that disputes are still likely to arise about the actual
level of an employee's wage should conflict between an applicable collective agreement and a
wage in an individual's contract of employment arise.
4.2.5 The enforcement of the National Minimum Wage (NMW)

• The NMWA overrides any contract, collective agreement, sectoral determination, or other law that prescribes a wage less than the NMW.

• The BCEA provides for all the provisions relating to enforcement of the NMWA.

• The BCEA provides for a system of administrative enforcement by the Department of Employment and Labour or through legal proc eedings
initiated by workers themselves.

• As per the BCEA, a labour inspector allows workers to institute free legal proceedings at the CCMA for any amount owing to th em in terms of
the NMWA.

• The CCMA will attempt to resolve the dispute through conciliation, failing which the matter may be arbitrated.

• The BCEA also allows disputes about an employee allegedly discriminated against for exercising their rights in terms of the B CEA (see
sections 78) to be resolved.

• The employee may claim for unfair dismissal; whether a bargaining council, the CCMA or the Labour Court has jurisdiction over the dismissal
claim.

• The Labour Court has jurisdiction over the employee's entitlement to severance pay in case of a dismissal for operational
reasons (see section 41 of the BCEA and chapter nine ).
4.3.3. The Basic Conditions of Employment Act and the regulation of other terms and
conditions of employment
4.3.3.1. The goals of the BCEA

The goals of the Basic

Conditions of Employment
Act (BCEA):

The primary goal of the The BCEA seeks to

The BCEA does not apply
BCEA is to give effect to accomplish this by
uniformly to all aspects of
section 23(1) of the establishing and
employment, and its
Constitution, which enforcing basic
provisions are not set in
relates to the right to fair conditions of
stone.
labour practices. employment.
The application of the BCEA
Study par 4.3.2 of the prescribed book.
• Like the LRA, the BCEA applies to 'all employees' but not to independent contractors. This means that the distinction between
employees and independent contractors must be considered when considering the scope and application of the BCEA.

• As with the LRA, the BCEA also contains a presumption as to who is an employee.

• There are certain general exclusions from the operation of the BCEA.

• Section 1 excludes independent contractors totally from the operation of the Act.

• Apart from those general exclusions from the BCEA, there are certain partial exclusions.

• Section 6 provides that chapter two of the Act which regulates working hours, does not apply to certain employees.

• The provisions of chapters two and four do not apply to employees who work less than 24 hours a month for an employer.

• Senior managerial employees, employees engaged as sales staff who travel to the premises of customers and who regulate their
own hours of work and employees who work less than 24 hours a month for an employer, are excluded by the BCEA.
Regulation of working time
Study par 4.3.3 of the prescribed book.

• Ordinary hours of work:

o Chapter Two of the BCEA regulates the working hours of

employees.

o Maximum ordinary working hours are 45 hours per week.

o If an employee works more than five days a week, the

workday is eight hours.

o Ordinary working hours may be extended by agreement

between employer and employee, but only up to 15 minutes
a day or 60 minutes a week.

o Section 9 does not apply to employees who earn in

excess of the statutory threshold.
Overtime (time worked in excess of ordinary hours of work):

Overtime may only be worked in An agreement to work overtime A collective agreement may
accordance with an agreement. concluded in the first three months Even where an agreement exists, increase the maximum overtime to
The agreement can be with an is only valid for one year, and employees can't be required to 15 hours a week, but this may not
employee or through a collective further agreements are needed work more than 10 hours a week. apply to more than two months in
agreement. after that year. a 12-month period.

Section 12 provides that an

employer may require or permit an
employee to work more than 45 Overtime is remunerated at one
Sections 10, 11, and 12 should be
and a half times the employee's
ordinary hours a week, but less referred to determine who earns in
normal remuneration, although the
than 43 hours one week and more excess of the statutory threshold.
employer may grant paid time off.
than the average is 5 hours
overtime a week.
Meal intervals and rest o The employer must give an employee who
periods: works continuously for more than five hours a
meal interval of at least one hour.

o The employee must be remunerated for the meal

interval if required to be available for work or can't
leave the workplace.

o A written agreement may reduce the meal interval

to 30 minutes.

o An employer may allow a daily rest period of at

least 12 consecutive hours between ending and
recommencing work.

o An employee must have a weekly rest period of

at least 36 consecutive hours, which must be a
Sunday unless otherwise agreed.
Sundays, public
holidays and o If an employee doesn't normally work on a Sunday, the
night work: employer must pay double.

o If the employee normally works on a Sunday, they must be

paid at one and a half times their wage for each hour
worked.

o An employer may not require an employee to work on a

public holiday unless the parties have agreed otherwise.

o If the employee does work on a public holiday, they must be

paid at least double for the hours worked.

o Night work is defined as work after 18:00 and before 06:00

the next day. Employees who work at night may require
transportation.
Leave: Study par 4.3.4 of the prescribed book.

Maternity and family

responsibility leave: An employee
Annual leave: An employee is is entitled to at least four
Sick leave: An employee is
entitled to at least 21 consecutive consecutive months' maternity
entitled to 30 days' sick leave in a
days' annual leave on full leave. An employee is entitled to 3
36-month cycle.
remuneration. days paid family responsibility
leave during each annual leave
cycle.
Parental Leave:

o The provisions for parental leave have been criticized for various reasons, including low protection levels and
ignoring the reality that the care obligation not only continues to which it applies and largely ignoring the reality
that the care obligation not only continues to which it applies and largely ignoring some of the deficiencies of
the BCEA is MIA v State Information Technology Agency (Pty) Ltd (2015) 36 ILJ 180 (LC) a male employee
had entered into a civil union with another man. The couple not only commissioned a surrogate mother to give
birth to their child, But also decided that the male employee in question would take all of four months' paid
maternity leave as provided for in the employer's and other parents' unpaid leave. The court accepted that the
employee was entitled to both adoption leave and parental leave and then the employee unfairly accepted that
the employee was entitled to both adoption leave and parental leave and then the employee unfairly
discriminated against the specific employee.
Adoption Leave: o Section 25A provides for adoption leave of
at least 10 consecutive days for an
employee. Section 25A provides for
adoption leave of at least 10 consecutive
days for an employee from the day which
the adoption order is granted by the court
or from the day the child is placed with the
adoptive parent pending a court order,
whichever day comes first. Section 25A
provides that an adoptive parent of a child
under the age of two is entitled to adoption
leave of ten consecutive weeks or to the
parental leave provided in section 25 that
this entitlement is the adoptive parent
pending a court order, whichever date
come first.
Commissioning Parental Leave and Payment during Leave:

• Commissioning Parental Leave:

o Section 25A provides that a commissioning parent is also entitled

to adoption leave of ten consecutive weeks or to the parental
leave provided in section 25 and there may take ordinary section
25A parental leave. It is for both parents to decide who will take
what type of leave.

• Payment/Notice during Leave:

o In respect of parental, adoption or commissioning parent leave,

payment, during leave is now one of the three instances the
employee has to notify the employer in writing one month in
advance that this leave will be taken.

•
Particulars of employment and
remuneration: o The employer must provide the employee with
Study par 4.3.5 in the prescribed book. certain particulars in writing. These particulars
include the full name and address of the employer,
the occupation and a brief description of the work,
the place of work, the date on which employment
began, the employee's ordinary hours and days of
work, the employee's wage or the rate and method of
calculating wages, the rate of pay for overtime work,
any other cash payments the employee is entitled to,
how frequently remuneration will be paid, any
deductions to be made, the leave to which the
employee is entitled, the period of notice required to
terminate employment, any payment in kind, any
period of employment with a previous employer that
counts towards the employee's period of employment
and a list of any other documents that form part of the
contract.
Remuneration Termination

o Section 37 of the BCEA provides for minimum notice periods.

o If the employee has worked for longer than six months but less than a
year, the minimum notice period is one week. If the employee has
o One of the terms of employment worked for longer than one year, the minimum notice period is four
which the BCEA does not prescribe is weeks.

a minimum wage - this is now done o Section 38 of the BCEA permits the payment of remuneration instead
of notice.
by the NMWA in conjunction with the
o Section 40 provides that, on termination of employment, an employer
different sectoral determinations. must pay an employee money owing in respect of any time off for
Section 35 of the BCEA relates to the overtime worked, remuneration in respect of annual leave and any
other payments that are included in the contract.
calculation of remuneration and
o Section 41 of the BCEA provides for the payment of severance pay if
wages. an employer dismisses an employee for operational reasons.

o Section 42 of the BCEA provides that on termination of employment

an employee is entitled to a certificate of service.

•
Variation of the provisions of the BCEA
Study par 4.3.7 of the prescribed book.

1. Variation by agreement

▪ A collective agreement concluded in a bargaining council may alter, replace or exclude any basic condition of employment if the collective
agreement is consistent with the purpose of this Act and the collective agreement does not:

▪ reduce the protection afforded to employees who perform night work in terms of section 17(3) and (4).

▪ reduce an employee’s entitlement to maternity leave in terms of section 25;

▪ reduce an employee’s entitlement to adoption leave in terms of section 25A;

▪ reduce an employee’s entitlement to commissioning parental leave in terms of section 25B;

▪ reduce an employee’s entitlement to sick leave in terms of sections 22 to 24;

▪ conflict with the provisions of Chapter Six.

▪ An employee and an employee may agree to replace or exclude a basic condition of employment to the extent permitted by this A ct or a
sectoral determination.

▪ No variation is permissible in terms of altering an agreement between an employer and an employee permitting:

▪ a contract of employment or agreement between an employer and an employee contrary to the provisions of a collective agreement

▪ a collective agreement contrary to the provisions of a collective agreement concluded in a bargaining council
Variation by the Minister:

• Basic conditions may be changed firstly by means of a collective agreement concluded in a

bargaining council. The parties in a bargaining council may change anything contained in the BCEA
except the protection of employees in respect of working hours, ordinary hours of work, or night work.

• Secondly, basic conditions of employment may be changed in other words a sectoral determination or
variation of basic condition of employment by agreement between the employer and the employee;
they may replace, exclude or vary that condition.

• Thirdly, a basic condition may be varied is work in Ministerial and Sectoral determinations.
Ministerial and Sectoral Determinations:
Study par 4.3.8 of the prescribed book.

o The Minister of Employment and Labour has significant powers in terms

of the BCEA. The Minister has the power to exclude or include certain
categories of employees in the BCEA. These determinations are often
referred to as 'section 9 of the BCEA'.
The BCEA (or a sectoral determination), contracts of employment and collective
agreements
Study par 4.3.9 of the prescribed book.
• It may be difficult to ascertain an employee's terms and conditions of employment in practice.

• This is because these terms and conditions are governed by the BCEA or the contract of employment or a collective agreement or by both contract and collective
agreement.

• There are some guidelines to determine which source of terms and conditions applies. These guidelines assume that there is one provision that comes with one proviso
namely that there is a bargaining council agreement.

• There are some exclusions that need to be considered before applying the BCEA to the employee.

o The BCEA's general exclusions, some of the partial exclusions, and issues where the BCEA regulates something similar to an annual performance bonus need
to be considered.

• The next step is to consider the BCEA's starting point in respect of employment contracts, set out as follows:

o Inclusion of provisions in contracts of employment: A basic condition of employment constitutes a term of any contract of employment except to the extent
that:

▪ any other law provides a term that is more favourable to the employee

▪ the basic condition of employment has been replaced, varied, or excluded in accordance with the provisions of this Act

▪ a term of contract of employment is more favourable than the basic condition of employment
Conti…
o A minimum standard of employment contained in the BCEA will constitute a term and condition of employment
unless another law or the contract of employment is more favorable to the employee than the minimum
standard.

o If an employment contract provides, for example, that an employee is entitled to 25 days' paid annual leave,
the employee will be entitled to the 25 days' leave and not only the 21 days' leave as provided for in the BCEA.

o An employee and an employer cannot contract out of the BCEA. It is not possible for them to agree that the
BCEA or anything done in terms of the BCEA will not apply. Section 5 of the BCEA provides simply that what
the BCEA provides precedes any agreement entered into before or after the commencement of the BCEA.
When it comes to the interaction between collective agreements and the employment contract, section 23(3) of
the LRA provides that a collective agreement varies or changes the employee's contract of employment
automatically IF it applies. Further, section 199 of the LRA provides as follows:

o Contracts of employment may not disregard or waive collective agreements or arbitration

awards

▪ A contract of employment, whether concluded before or after the coming into operation of any
applicable collective agreement or arbitration award, may not:

▪ permit an employee to be treated in a manner, or to be granted any benefit, that is less

favourable than that prescribed by that collective agreement or arbitration award

▪ waive the application of any provision that collective agreement or arbitration award
 ▪ A provision in any contract that purports to permit or grant any payment, treatment, benefit, waiver or exclusion prohibited
by subsection (1) is invalid.

• Employees and employers cannot vary or escape the minimum standards of employment as laid down in the BCEA through
either a contract of employment or a collective agreement.

• From this discussion, it should be clear that there are rules of precedence to determine which source of terms and conditions of
employment applies. There are issues regarding a conflict between the sources.

• Collective agreements and legislation usually take precedence over the individual employment contract.

• Collective agreements may, depending on what they provide for, and where they are beginning council agreements, take
precedence even over the BCEA, provided that this variation falls within the framework of the BCEA.

• A contract of employment may always provide for more favourable terms and conditions than the minimum standards set out in the
BCEA.

• Some of the minimum standards of the BCEA may be varied or changed, even if this change is less favourable to the employee.
when determining an employee’s actual terms and conditions of employment, the following

should be considered:

o Does the BCEA (or a sectoral determination) apply to the employee (see 4.3.2) and is the term
and condition in question regulated by the BCEA?

o Is there an applicable bargaining council collective agreement stipulating minimum terms and
conditions of employment?

o Is there an applicable enterprise or plant level collective agreement regulating the issue?

o If there is a contract of employment, is there in line with either the BCEA or an applicable collective
agreement?
Enforcement of
The BCEA provides for a system of labour inspectors.
the BCEA
Study par 4.3.10
of the
prescribed book. The BCEA authorizes labour inspectors to issue compliance
Enforcement of orders requiring employers to comply with the Act.

the BCEA:

The CCMA is available to resolve disputes through conciliation

regarding alleged failures to comply with the BCEA. The CCMA
also arbitrates disputes where conciliation fails.
The BCEA states that an employee can exercise their
rights without facing discrimination from their employer.
These rights include the right to:

o To allege failure to comply with the provisions of the Act

o To refuse to comply with any instruction that is contrary

to the provisions of the Act

o To refuse to agree with any term or condition that is

contrary to the provision of the Act

o To refuse to sign a document that is contrary to the

provision of the Act

o To participate in any proceedings in terms of the Act

• The BCEA prohibits an employer from discriminating against an employee (including a former employee or applicant) for
exercising any right provided by the Act.

• The BCEA provides for two types of processes for its enforcement, namely enforcement by the Department of Employment
and Labour and through legal proceedings initiated by workers themselves.

• Labour inspectors are empowered to enter, monitor, and enforce compliance with the BCEA and other labour legislation.

• A labour inspector who believes that an employer is not complying with the BCEA may request the CCMA to undertake
conciliation.

• The Director-General may request the CCMA to make the undertaking arbitration.

• A labour inspector may challenge a compliance order.

• The Labour Court has exclusive jurisdiction to grant orders relating to the examination of an employer's books or to rectify
non-compliance.

• The Labour Court and the CCMA also have concurrent jurisdiction over contractual claims arising from the BCEA.

THE END!!!