Tuesday, February 10, 2015
Employment contracts: what the law says you must do
You hire Edward as your manager. He starts work on Monday without signing his employment contract. You ask him on Thursday to sign the document, but he refuses because he doesn’t agree with the restraint of trade clause. You threaten to cancel the contract. He threatens to go to the CCMA because, having started work, he has automatically become your employee. In this situation Edward is right – you can’t cancel his contract. If you want him to sign, you will have to take out the restraint clause. Rather ensure Edward signs the contract – including the restraint of trade clause – before you appoint him or he commences employment. If he refuses to accept the terms of employment, you don’t have to employ him, because he has neither signed the contract, nor begun work. The South African labour laws offer your employees protection, but they also allow you a degree of flexibility in what you agree with your employee – so you need to be proactive and protect yourself. Do this by taking these three steps today: Design an employment agreement (whether it’s in the form of a contract or a letter) that complies with the law, but fits with your business requirements. Make it a requirement for the selected job applicant to sign the contract BEFORE commencing employment Explain (with the aid of an interpreter if necessary) the contents of the contract to the employee/applicant in a language he understands. This is required by law. By law, there are 17 elements that must be contained in the employment contract. Protect your business by including another nine vital points in the contracts. What does the law say you must do: You must give your employees, in writing, the terms and conditions of their employment. This document can take the form of a letter of appointment, or you can create a more formal contract of employment – the form doesn’t matter it’s the content that’s important. Getting your employee to sign the document avoids disputes about whether or not it was given and what it contains. You must do this when the employee starts employment and you must retain the document for at least three years after termination of the employment relationship (Section 29 of the BCEA). You must also update this employment document and provide the employee with a new copy when: the law changes you and your employee agree to changes in the terms and conditions you increase the employee’s pay or benefits (this you could do in a supplementary letter). TIP: Better late than never! Check all your personnel records and draw up the employment documents now, even if your employees have been working for you for years. Even part-time staff must have a contract This law applies to you if your employees are temporary or part-time, even if they: have a fixed employment period, or only work one day a week, or only work every weekend, or only work half day. In other words, anyone who qualifies as an ‘employee’ should receive this document from you (refer to chapter E03 in Labour Law for Managers loose leaf service). Three easy steps to protect yourself from legal comebacks. Remember - As South African labour laws offer your employees more protection than they offer you, you need to be proactive and protect yourself!