Protect your business through compliance with labour law


Following a recent case where the Commission for Conciliation, Mediation and Arbitration (CCMA) compelled a Spar Franchisee to comply with compliance orders issued and pay all complainants an amount of R 11,935,478 for gross violations of labour laws which were happening at their stores across the country, we asked Ansofie van der Walt of the LWO Employers Organisation to give labour guidelines.

Labour law sets strict requirements that employers must comply with. Non-compliance holds a serious business risk for employers that is often underestimated and left unaddressed. Arbitration awards against employers have a definite financial impact and also negatively affect the business’s brand name. Compliance with labour law is critical for every employer, irrespective of the number of employees or business industry.

What can employers do to protect their businesses?

Firstly, make sure you comply with labour law. Secondly, use labour law to your advantage to protect your business and limit risk by proactively addressing possible future disputes between the employer and employee.

How do I comply with labour law?

By addressing labour risk proactively, the employer can greatly contribute towards the business’s sustainability and profitability and ensure a working environment with reduced conflict, friction and misunderstanding, which in turn creates a structured environment receptive to growth. Make sure you have the following 5 things in place:

  • Employment contract – the employment contract is the most important document in the relationship between the employer and employee. One of the biggest mistakes employers make is not to implement written employment contracts, or to settle for a generic employment contract that offers minimal protection when there is a dispute in the workplace. When drafting an employment contract, the employer must take care to ensure that the contract complies with all applicable labour legislation depending on the specific industry.
  • Disciplinary code – the disciplinary code serves as a guideline for employers of what the appropriate sanction is for certain offences. The disciplinary code also ensures that all employees are aware of the rules in the workplace as well as the consequences should these rules be broken.
  • Policies and procedures – a policy informs employees of the rule(s) in respect of a certain topic. The employer puts these rules in place in order to ensure the smooth and efficient running of business operations. A procedure is an established or official way of handling a situation, put in place to inform the employees and employers alike, of the necessary steps when a certain incident occurs.
  • Registration for UIF and the Compensation Commissioner.
  • Labour law – labour legislation in South Africa creates a highly regulated labour environment where employers must comply with the following legislation: Basic Conditions of Employment Act, Labour Relations Act, Industry specific legislation (Sectoral Determinations or Bargaining Council Main Collective Agreements), Employment Equity Act, Occupational Health and Safety Act and Skills Development Act.

How do I use labour law to protect my business?

Also include proactive clauses in the employment contract to eliminate possible future disputes and put the employer in the best position with regards to the employment relationship going forward. Proactive clauses include:

  • Reference to policies, procedures and a disciplinary code that describe rules and procedures the employer and employees must adhere to
  • Time periods – probation period, retirement age, short time, lunch breaks, etc.
  • Remuneration – overtime, Sunday pay, public holidays, etc.
  • Consent – medical testing, alcohol and drug testing
  • Consent – deductions for damages, training, etc.

In addition to the employment contract, the employer can add annexures to further protect the business going forward. Typical annexures include:

  • Declaration of duties – what is expected from the employee with regards to duties and the employer’s fixed operational standard
  • Restraint of trade and confidentiality agreement – this is crucial to protect confidential information, unique methods and procedures, patents, etc. and prevent this sensitive information ending up with the competition

The scope of labour law can be overwhelming as it is a highly regulated environment. FASA entered into a collaboration agreement with the LWO Employers Organisation to assist FASA members as employers to comply with labour law. The LWO is registered as an employers’ organisation with the Department of Labour and has the right to represent members at the CCMA, Bargaining Councils and Labour Court. The LWO offers a hands-on approach to everyday misconduct and disputes in the workplace through a 24/7 legal advice helpline manned by highly qualified labour law experts, as well as a wide variety of services rendered on the employer’s premises. A complete range of labour documentation including purpose-built employment contracts is included as benefits for employers who are members of the LWO.

Latest posts by Ansofie van der Walt (see all)