LABOUR LAW: AN INTRODUCTION TO THE BASIC CONDITIONS OF EMPLOYMENT ACT (BCEA)

INTRODUCTION

The Basic Conditions of Employment Act (BCEA), 75 of 1997, prescribes the rules and regulations applicable to most persons employed in South Africa. Its purpose is to align the minimum terms and conditions of employment for workers, with the constitutional right to fair labour practices as set out in Section 23(1) of the Constitution. It should inform the basis of any employment contract. In addition to providing the minimum employment standards, the BCEA also ensures fair treatment within the workplace.

WHAT IS THE BCEA?

The BCEA is a labour law act that sets out clear terms and conditions for various aspects of employment, such as leave, wages, working hours and overtime. It applies to most employers and employees, with the exception of members of the National Defence Force, independent contractors, and unpaid volunteers.

WHY IS THE BCEA IMPORTANT?

The Act ensures that employees' rights regarding fair treatment and working conditions are protected. By regulating and prescribing rules in the areas of leave, working hours, overtime and the notice requirements on termination, it creates a productive work environment while protecting the rights of employers and employees. According to the Act, employers cannot set conditions for employees that are less favourable than that which is set out in the BCEA.

WHO DOES THE BCEA APPLY TO?

The BCEA covers the majority of employees in South Africa. However, exceptions include independent contractors which typically operate outside the traditional employer-employee relationship, unpaid volunteers and employees in specific roles like intelligence services.

Certain provisions of the Act are not applicable to senior managerial employees and employees working less than 24 hours a month, this includes ordinary working hours and overtime. Some industries also follow sector-specific rules and guidelines.

The BCEA earnings threshold determines which provisions of the BCEA will apply to an employee. Should an employee’s gross earnings total more than the threshold amount, they will be excluded from certain provisions of the Act, such as ordinary working hours, overtime, meal intervals, and overtime rates on Sundays and public holidays.

On 1 April 2024, the earnings threshold was set at R254 371.67, which amounts to a monthly amount of R21 197.64

KEY PROVISIONS OF THE BCEA

The Act makes provision for a wide range of employment conditions and rights, ensuring that the parties to an employment contract understand their rights and obligations. These conditions include:

1. WORKING HOURS

The Act establishes clear limits on working hours to ensure sustainable conditions and prevent unreasonable working hours:

• Normal working hours: The Act permits a maximum of 45 normal working hours to be worked in a week (9 hours per day if the employee works for 5 days or less, and 8 hours per day if employees work for more than 5 days). The Act allows for flexibility in the management of working hours through compressed working weeks and the averaging of hours. These provisions are meant to assist employers and employees in arranging schedules that comply with the Act, while also meeting operational needs.For example, under a compressed workweek agreement, an employee may work a 12-hour shift a day (including meal intervals) as long as they do not work more than 45 ordinary hours a week. In addition, a collective agreement can average working hours over four months, so that no employee works more than the ordinary hours. These arrangements must be formalised in writing to comply with the BCEA.

• Overtime: Overtime is limited to 10 hours a week. Overtime is paid at one and a half times the regular rate, with the exception of Sundays and public holidays, which require remuneration at twice the regular rate. Alternatively, overtime can, by agreement, be exchanged for paid time off.

• Rest periods: the employer must ensure that an employee receives a daily rest period of at least 12 consecutive hours between shifts and a weekly rest period of at least 36 consecutive hours, including Sunday, unless otherwise agreed. Under the conditions that the employee stays on site and gets meal intervals of at least 3 hours, the daily rest period can be reduced to 10 hours by written agreement. Other flexible weekly rest provisions that are allowed include 60 consecutive hours of rest every two weeks, or adjusting weekly rest periods, as long as any reduction in one week is made up for by additional rest in the following week.

2. REMUNERATION

Payment of remuneration is a fundamental principle of the Basic Conditions of Employment Act and is commonly referred to as the amount of money owed to an employee in return for working for the employer:

• Minimum wage: minimum wages are set by sectoral determinations, bargaining council agreements, or the National Minimum Wage Act, which prescribes a minimum wage rate payable for each hour of work performed.

• Payment rules: employers are required to pay weekly, monthly or fortnightly wages, as agreed.

• An employer is required to give an employee a comprehensive payslip that outlines both parties’ details, the working hours, including overtime and public holidays, the amount paid, the deductions made and the duration of the payment period.

• Deductions from an employee’s remuneration can only be made when the employee has given written permission for a specific debt or if the deduction is required to recover damages caused by the employee and only after a proper procedure has been followed. In these instances, the deductions may not exceed more than 25% of the employee's remuneration.

• Deductions may also be made when mandated by law, a court order, an arbitration award, or a collective agreement.

3. LEAVE

Leave provisions ensure employees receive the necessary time off:

• Annual leave: employees are entitled to receive a minimum of 21 consecutive days of paid leave for each completed 12-month leave cycle, which amounts to 15 working days in the instance of a 5-day workweek, or 18 working days in a 6-day workweek. Simply put, the number of working days falling into the required 21 consecutive days amounts to the full pay the employee is entitled to, in the annual leave cycle.This can further be broken down to either 1.25 or 1.5 days’ leave for every month, subject to the number of days in the workweek. Should the employer have a shutdown period, the employer is entitled to require that an employee take their annual leave over this period. If the employee has insufficient leave days, this will amount to unpaid leave.No accrued annual leave may be paid out instead of leave being taken, unless a termination of employment occurs, in which case accrued leave must be paid to the employee, provided that the employee was employed for longer than 4 months.

• Sick leave: an employee is entitled to sick leave, over a three-year cycle, equal to the number of days the employee would have worked over a 6-week period. This would amount to 30 days in the case of a 5-day workweek, and 36 days in the case of a 6-day workweek. However, it should be noted that sick leave is not limited to 10 days for each of the 3 years.An employer is prohibited from restricting an employee to only 10 sick days per year. During the first 6 months of employment, an employee is entitled to 1 day of paid sick leave for every 26 days worked. Should the employee not have used all their sick leave at the end of a 3-year cycle, such leave is forfeited and cannot be carried over to the next cycle.  Should employment be terminated, an employee will not be entitled to receive payment for unused sick leave.

• Maternity leave: the BCEA stipulates that an employee is entitled to 4 months unpaid maternity leave. An agreement between the employer and employee regarding remuneration or other benefits during maternity leave is at the discretion of the employer, and is not prescribed by the Act. It remains the responsibility of the employee to claim maternity benefits from the Unemployment Insurance Fund (UIF).

• Parental leave: employees have the right to 10 consecutive days of parental leave. The leave commences when the child is expected to be born, when an adoption order has been granted, or when the adopted child is placed in their care - whichever happens first. Employees must inform their employer, in writing, about their intended leave dates at least a month in advance, or as soon as they can, if early notice is not possible. Parental leave benefits are paid by the UIF.

• Adoption and surrogacy leave: adoptive and commissioning parents in a surrogacy agreement are entitled to certain leave benefits. The benefits that the adoptive parents are entitled to, for children under 2 years of age, are 10 consecutive weeks of unpaid leave for one parent, and the option of 10 consecutive days of unpaid parental leave for the other parent. The leave commences from the day the adoption order is granted, the day a child is placed in the care of the adoptive parent(s) by a court, or, in the case of surrogacy, the day the child is born. The notice period for both forms of leave is the same as that of parental leave.

• Family responsibility leave: employees employed for longer than 4 months and working at least 4 days a week, are entitled to 3 days of paid family responsibility leave in each annual leave cycle. Employees can use this leave in the instance of a sick child or in the event of the death of a close relative, like a spouse/life partner, parent, sibling or child. Employers are entitled to request reasonable proof of such an event prior to payment of the leave. Family responsibility leave that has not been used in a current leave cycle may not be carried over and is forfeited, unless a collective agreement states otherwise.

4. TERMINATION OF EMPLOYMENT

Section 37 of the BCEA stipulates that a termination of employment can only occur when notice is given. The following minimum notice periods are prescribed:

• 1 week, if the employee has been employed for 6 months or less;

• 2 weeks, if the employee has been employed for 6 months but less than 1 year; and

• 4 weeks, if the employee has been employed for more than 1 year.

Domestic workers and farmworkers are required to give 4 weeks’ notice if they have been employed for 6 months or more.

The Act further requires that a notice of termination of employment must be given in writing, except for the instance where the employee is illiterate. If the employer gives notice to the employee, he or she may not do so during a period of leave.

This does not affect the right of an employer or employee to terminate employment without notice for any reason recognised by law, for example, if an employee is dismissed for misconduct.

WHAT HAPPENS IF YOU DO NOT COMPLY WITH THE BCEA?

Employers who do not comply with the provisions of the BCEA could face penalties. The amount of a fine depends on the nature of the violation, and whether previous violations occurred. If an employer fails to remunerate the employee the money that is owed and if there are previous violations, the employer could be fined up to twice the amount they should have paid. For other types of violations, like administrative non-compliance, fines start at R300 and can reach up to R1500 for each employee.

In summary, the Basic Conditions of Employment Act is essential for promoting fairness and protecting employees’ rights. Both employers and employees benefit from understanding its provisions, as it helps maintain compliance and fosters a respectful, harmonious work environment.

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