What Is a Settlement Agreement?

A settlement agreement is a legally binding contract in which parties voluntarily agree to resolve a dispute or potential dispute without proceeding to litigation. Key features include:

• Parties typically agree to waive future claims related to the same matter.
• Payment could include lump sums, installment payments. 
• Confidentiality clauses are common in employment agreements to protect sensitive information.
• No-admission language often states that the settlement does not constitute an admission of liability.

How Settlement Agreements Are Created

• Identify and define disputes: Be specific about the issues being settled.
• Outline obligations and timelines: Clearly detail who must do what and by when.

Enforcing Settlement Agreements

• A settlement agreement is only as good as its enforceability. 
• Simple Contractual Recourse:  If one party breaches the agreement, the other can sue for damages.
• The parties consent to this agreement being made an arbitration award in terms of s142A (1) of the Labour Relations Act
• The parties agree that in the event of non-compliance of this agreement, the party defaulting will pay the full costs incurred by the other party in enforcing this agreement. 
• No variation of this agreement shall be legally binding unless reduced to writing and signed by the parties.

Common Types of Settlement Agreements

Employment Settlement Agreements: Cover dismissals, retrenchments, exit packages, or workplace disputes. 

Why Opt for a Settlement Agreement?

• Cost-effective: Avoid court and legal fees.
• Private and confidential: Avoid public litigation.
• Time-efficient: Resolve disputes quickly.
• Control outcomes: Parties decide terms, subject to fairness and legality.

Conclusion

Settlements are faster, cheaper, and more private than litigation, but only if drafted precisely and enforced effectively.

FAQs

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CAN ONE BE COMPELLED TO UNDERGO A POLYGRAPH TEST?

An employee may not be compelled to undergo a polygraph examination unless she or he agrees to it or a collective agreement or contract of employment provides for it. The agreement must be in writing.

However, it should be noted that even if there is a written agreement in existence, an employee can still refuse to take this test. The individual should be informed that—

• The examinations are voluntary;
• Only questions discussed prior to the examination will be used;
• He/she has a right to have an interpreter, if necessary;
• Should he/she prefer, another person may be present during the examination, provided that person does not interfere in any way with the proceedings;
• No abuse in whatever way will be allowed;
• No discrimination will be allowed; and
• No threats will be allowed.

A qualified polygraph examiner would have to conduct the test under strict control and would have to adhere to the code of conduct that ensures fairness.

WHEN IS THE EMPLOYER PERMITTED TO USE POLYGRAPH? 

Generally, employers are permitted to use the polygraph to investigate specific incidents where— 

1. Employees had access to the property, which is the subject of the investigation. 
2. There is a reasonable suspicion that the employee was involved in the incident. 
3. There has been economic loss or injury to the employer’s business, such as theft of company property. 
4. The employer is combating dishonesty in positions of trust. 
5.  The employer is combating serious alcohol, illegal drugs, or narcotics abuse and fraudulent behaviour within the company. 
6. The employer is combating deliberate falsification of documents and lies regarding the true identity of the people involved. 

WHO GETS THE POLYGRAPH TEST RESULTS? 

Polygraph results can only be released to an authorised person. 

Generally, it is the person who has undergone the polygraph test (examinee), or anyone specifically designated in writing by the examinee, and the person representing the employer or government agency that requested the examination. 

WHAT IS THE STATUS OF POLYGRAPH TESTS AT THE CCMA? 

Polygraphists have been accepted as expert witnesses whose evidence needs to be tested for reliability. The duty of the Commissioner is to determine the admissibility and reliability of the evidence. 

Polygraph tests indicate whether or not the subject has answered the questions truthfully, but are not regarded as being 100% accurate. They may not be interpreted as implying guilt, but may be used to support other available evidence that suggests that the employee concerned did indeed commit the alleged misconduct. In other words, polygraph test results, on their own, are not a basis for proving that someone committed an act or omission as alleged by the employer, but may be used as a factor in determining the probabilities. 

Because polygraph tests are regarded as not being entirely reliable, dismissals based solely on the result of a polygraph test have generally been found to be unfair.

The Commissioners at the Commission for Conciliation, Mediation and Arbitration (CCMA) and the judges at the Labour Court will not accept the results of the polygraph test as being conclusive.

Often, employers do not understand that a negative polygraph test cannot be the sole factor in a guilty finding at a disciplinary enquiry.

The CCMA has, in fact, accepted that polygraph testing can be used as a further aggravating factor against an employee who has been dismissed for dismissible behaviour. However, there must be corroborating evidence.

NEED GUIDANCE ON POLYGRAPH TESTING IN THE WORKPLACE?

Talk to our legal team to understand your rights and responsibilities around polygraph exams. Whether you’re an employer looking to use them lawfully, or an employee unsure of your obligations, Cape Labour is here to help.

FAQs

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In terms of Section 37 of the BCEA Notice of termination of employment, when given by the employer, must not be given during any period of leave to which the employee is entitled in terms of chapter 3 of the Act, and may not to run concurrently with any period of leave to which the employee is entitled, except sick leave.

An employee has the right to give notice of termination of employment during a period of leave. However, there are a few factors to consider.

Firstly, the notice period should comply with the terms stated in the employment contract or collective bargaining agreement, if applicable. These terms usually specify the required notice period for termination.

Additionally, it’s important to consider the type of leave the employee is taking. If the employee is on statutory leave, such as annual leave or sick leave, they can still give notice during this time. However, if they are on special leave, such as maternity leave or family responsibility leave, there may be specific rules governing the termination of employment during such leave.

It’s advisable for both the employee and the employer to consult the employment contract, applicable labour laws, and any relevant policies or agreements to ensure that the termination process is conducted in accordance with the law and the terms provided.

In South Africa, both the employer and the employee have certain rights and responsibilities when it comes to termination of employment during maternity leave.

An employee on maternity leave is protected by the Basic Conditions of Employment Act (BCEA) and the Labour Relations Act (LRA). These acts provide guidelines to protect the rights of employees, including those on maternity leave. According to the BCEA, an employer cannot give notice of termination of employment to an employee during her maternity leave period, unless there is a valid reason unrelated to the employee’s pregnancy or maternity leave.

Similarly, an employee on maternity leave cannot give notice of termination of employment during the maternity leave period, as the purpose of this leave is to provide the employee with uninterrupted time to recover from childbirth and care for her newborn.

However, it’s important to note that after the maternity leave period is over, normal rules regarding notice periods and termination of employment will apply. Either party can initiate the termination process under the usual employment laws and regulations.

FAQs

The post Giving Written Notice whilst on Annual Leave, Sick Leave, Maternity Leave or Family Responsibility Leave appeared first on Cape Labour live site.

SweepSouth’s report indicates that low-income households are forced to take on further debt.

• Domestic workers, including chauffeurs and gardeners, are entitled to claim if they are injured or contract a disease at work, according to an amendment in law.
• Government has encouraged domestic workers to claim from the Compensation Fund.
• Legal experts have also urged employers of private domestic workers to register their domestic workers for the Compensation Fund.
• For more financial news, go to the News24 Business front page.

Government is urging domestic workers to apply for compensation if they have been injured, disabled or contracted an occupational disease while at work, following a recent amendment in law that allows for them to claim benefits.

In a statement last week, Department of Labour deputy director Jan Madiega encouraged qualifying domestic workers, including chauffeurs and gardeners, to apply directly to the Compensation Fund.

The call follows an amendment to the Compensation for Occupational Injuries and Diseases Act, no. 130, to include domestic employees, in line with an earlier Constitutional Court ruling. These workers can also claim benefits retrospectively for occupational diseases, disabilities, or injuries dating from 27 April 1994 onwards.

Families of deceased domestic workers, who have died from occupational injury or disease since 27 April 1994, are also entitled to compensation, Madiega said.

Compensation Fund Legal Services’ Irish Lephoto said: “The changes in the amendment act will affect everyone and change how we do business.

“All workers have a right to social security, which is our priority. The inclusion of domestic employees in the act is very crucial to all of us; hence, we are taking steps to enforce compliance.”

READ | Middle class cracks: Italtile under pressure as high interest rates and inflation bite

According to the act, employers must register their private domestic workers with the Compensation Fund and submit a declaration of the annual earnings of the domestic worker via a Return of Earnings (ROE).

ROEs are calculated based on how much the domestic worker or employee earns per year and includes any compensation for the worker’s overtime, bonuses, and the cash value of any benefits given to the domestic worker, such as free accommodation or reduced rates.

Any employer who fails to register their domestic worker, submit the ROEs, and pay the fee, will be liable for a penalty and fine amounting to 10% of the annual earnings of the domestic worker.

Cape Labour consultant Bernard Reisner said the amendment came into law in April this year and applies to domestic workers, including chauffeurs and gardeners.

Reisner said employers need to pay an annual fee to the Compensation Fund – which is calculated on the average earnings of the domestic worker – and must register their domestic worker for the fund within seven days of their employment.

“I would encourage employers to register their domestic workers and pay the fee. Failure to do so would mean they become liable for penalties and fees,” he said.

According to Reisner, few businesses and homes have registered their domestic workers.

“I would say that 0.05% of businesses and people registered domestic workers. Not many people know about the law, and I would encourage the Department of Employment and Labour to educate people about it,” he said.

Meanwhile, South African Domestic Service and Allied Workers Union assistant general secretary Eunice Dhladhla said the union welcomed the amendment.

“We started advocating for the compensation and protection of domestic workers long ago. Before, workers would work while they were sick, and no one would care about it. They would have to pay for themselves if they went to hospital,” Dhladhla said.

However, according to Dhladhla, urgent intervention is needed from government to protect the rights of these workers.

The post Domestic workers can now claim for injuries dating back to 1994 appeared first on Cape Labour live site.

The Department said that research had been conducted annually for the past three years, assessing the impact of the national minimum wage on employment, hours of work and wages.  They observed no significant shifts in aggregate employment following the national minimum Wage increases over the past few years.

This sentiment goes against many expert opinions- that said the increases in the national minimum Wage amid the current economic climate would cripple businesses and led to job losses across the country.

Private households (domestic workers and gardeners) were also among the sectors noted by the Department of Employment and Labour. The research showed that it also experienced no significant changes in employment due to increased national minimum wage.

Latest South Africans currently employ around 863 000 domestic workers. South Africa has historically had around 1 million domestic workers employed in the country, but this took a massive knock in 2020 following the Covid-19 pandemic and subsequent lockdowns.

Other factors pressuring the affordability of the National Minimum Wage.

“While there are legitimate concerns about the impact of the annual national minimum wage adjustments on employment in the country, it is worth noting that the Covid-19 pandemic negatively affected employment as many business establishments closed down and many people left unemployed”.

Over 2021 and 2022, the Covid-19 pandemic coincided with the period of the national minimum wage adjustments, making it difficult to evaluate and isolate the impact of an increase in the national minimum wage from the effects of the pandemic.

Job losses were dominated by two causes: employers no longer being able to afford the services of their domestic worker and their employer moving homes. Domestic workers said they lost their job because their employer had move or the employers moved to a different town or city in South Africa or moved to another country.

The purpose of the national minimum wage is to ensure a living wage.

As of March 2023, the national minimum wage increased from R23.19 per hour to R25.42 per hour – equating to roughly R4 270.00 per month.

W.Tel no.: 021 423 3959
Cell: 082 433 8714
Fax: 021 4232 105
E-mail: bernard@capelabour.co.za
Website: www.capelabour.co.za

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The New National Minimum Wage for domestic workers is to be implemented from 01 March 2023.

As from 01 March 2023, the minimum wage will increase to R25.42 per hour, for each ordinary hour worked.

Domestic Workers Wage Increase

The increases was announced in the Government Gazette 45882, dated 21 February 2023.

Criminal Offence

An employer must be aware that it is a criminal offence to pay less that the National Minimum Wage. An employer is not permitted to engage in a negotiation with their employee/s whereby they agree to a daily wage that is less than the National Minimum Wage.

The Basic Conditions of Employment Act ensures that no employee can receive less than what is prescribed in the Act.

National Minimum Wage

The National Minimum Wage is only applicable to payment of ordinary hours of work and does not apply to allowances for transport, meals, accommodation and bonuses.

The occupation entitled “Domestic Worker” encapsulates the following job titles into the recognized definition- cleaner, child minder, carer, gardener and chauffeur.

New Minimum Wage Rate for Domestic Workers in South Africa

It is worth noting that the cost of living in South Africa is high, and domestic workers often struggle to make ends meet. 

The new minimum wage rate may not completely solve this problem, but it is a step in the right direction towards ensuring that domestic workers receive fair pay for their labour. 

By providing a decent wage, employers can help improve the living conditions of workers and contribute to reducing inequality in the country.

For more information on labour law advice or services. Contact Cape Labour for all the Labour Law advice and other services to make sure your business stays compliant with the law.

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The New National Minimum Wage for domestic workers is to be implemented from

01 March 2023.

As from 01 March 2023, the new national minimum wage will increase to R25.42 per hour, for each ordinary hour worked.

Domestic Workers Wage Increase

The increases was announced in the Government Gazette 48094, dated 21 February 2023.

Criminal Offence

An employer must be aware that it is a criminal offence to pay less that the National Minimum Wage.

An employer is not permitted to engage in a negotiation with their employee/s whereby they agree to a daily salary that is less than the National Minimum Wage.

The Basic Conditions of Employment Act ensures that no employee can receive less than what is prescribed in the Act.

National Minimum Wage

The Minimum Wage is only applicable to payment of ordinary hours of work and does not apply to allowances for transport, meals, accommodation and bonuses.

The occupation entitled “Domestic Worker” encapsulates the following job titles into the recognized definition- cleaner, child minder, carer, gardener and chauffeur.

Alternatives to Retrenchment

Due to the increase in the prescribed minimum wage, if an employer can no longer afford retaining their employee/s, it is suggested that in order to avoid retrenching their employee/s, an employer should seek alternatives by either reducing the number of working hours and/or reducing the number of days, the domestic worker works per week.

An employer cannot reduce the hours of work or days worked unilaterally as it can constitute a unilateral change to the terms and conditions of employment. Any agreement to this effect, must be agreed on freely and voluntarily and reduced to writing.

If you want to stay up to date on your rights, make sure to read the Cape Labour blog.

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1. The principle is that terms and conditions of employment may not be changed unilaterally by the employer and that the consent of the employee is required. This implies a negotiated process with the affected employees in order to secure such consent.

• Only where the nature of the job is drastically changed can it be said that there has been a unilateral change to the contract of employment.
• If the employer unilaterally changes the employee’s terms and conditions of employment, the employee has the right to declare a labour dispute at the CCMA, to restore the status quo.

2. Sometimes changes in terms and conditions are however necessary to ensure the survival of the organization or simply to become more competitive or efficient.
3. There are true, within our existing labour dispensation, mechanisms to effect such material changes lawfully and fairly.
4. There has to be a justifiable operational/business rationale for making those changes.
5. Employees who remain intransigent in the face of compelling reasons for change might find themselves at risk of being retrenched after a proper consultation process between the parties has taken place. It should be noted that there are procedures that have to be implemented by the employer, to effect a fair and lawful retrenchment.
6. I reiterate that changes to terms and conditions of employment cannot be made without prior consultation with the employee on the proposed changes. The consultation should be utilized, by both parties, as a tool toward progress and efficiency.
7. Once the employer obtains the consent of the employee, the terms and conditions of employment that are to be amended, are to be reduced in writing, in terms of an addendum to the contract of employment.

CONTACT CAPE LABOUR.

For more information on labour law advice or services. Please feel free to contact us at Cape Labour Consultants and we will gladly assist you. Cape Labour & Industrial Consultants is a Cape Town-based providing Labour Law (Industrial Relations) and advice to employers and employees across all market segments and industries since 1987.

For more information or to Contact Cape Labour. You can find all of our relevant details here.

W.Tel no.: 021 423 3959
Cell: 082 433 8714
Fax: 021 4232 105
E-mail: bernard@capelabour.co.za
Website: www.capelabour.co.za

The post When and how can an employer change the terms and conditions of employment of it’s employees? appeared first on Cape Labour live site.

The draft NLMP (National Labour Migration Policy) is the first comprehensive national policy on labour migration in South Africa, covering the management of labour migration into South Africa and from South Africa. It seeks to achieve a “brain gain” (through skills entering the country) and to counter a “brain drain”(through skills leaving the country).

The NLMP has been created to make it legal for the government to regulate the employment of foreign nationals in South Africa.

Why is the new labour migration policy being proposed?

South Africa is the largest host of foreign nationals in Africa. This is the reason for a comprehensive labour migration policy.

What does the Department of Employment and Labour want to achieve through the new policy? 

The NLMP will attempt to put more power in the hands of the Department of Employment and Labour, rather than Home Affairs, to govern and manage labour migration. Historically, Home Affairs has been the main administrative authority, with the Department of Employment and Labour acting mostly in an advisory capacity.

The policy claims to set out to make labour migration more beneficial to the South African economy, through interventions that will attract and retain skills in the country.

How would the policy affect the economy?

The policy notes that migrant labour is essential to the economy, as many foreign nationals possess critical skills that are scarce in South Africa. The policy aims to attract and retain these skills for the long-term benefit of the economy, leading to a “brain gain”.

How would the new labour migration policy affect foreign nationals?

The draft policy undoubtedly intends to crack down on foreign nationals unlawfully working in South Africa.

Will the policy even be implemented?

Writing a policy is one aspect, implementing it is another, South Africa does not have a great track record when it comes to enforcing the existing labour and migration laws.

The NLMP’s recommendations have not as yet been promulgated. It still needs to go through a Parliamentary process which shall most likely still take a lengthy period of time.

Currently, an employer who knowingly employs a foreign national, who do not possess a valid work permit and is employed, could be fined or face imprisonment for up to one year for the first offence. It should be noted that even if a domestic worker does not have a valid work permit, they still enjoy all the rights afforded by labour legislation such as the Labour Relations Act, Employment Equity Act and the Basic Conditions of Employment Act.

Once the NLMP is promulgated, it shall reaffirm that a domestic worker/ nanny who is a foreign national employed in South Africa, without a relevant work permit, shall not be entitled to continue working legally in South Africa. A domestic worker does not fall within the ambit of critical skills to perform his/ her work.  As a result hereof, persons employed in this sector can be sourced by South African citizens to meet South Africa’s labour market needs.

CONTACT CAPE LABOUR.

For more information on labour law advice or services. Please feel free to contact us at Cape Labour Consultants and we will gladly assist you. Cape Labour & Industrial Consultants is a Cape Town-based providing Labour Law Services In South Africa (Industrial Relations) and advice to employers and employees across all market segments and industries since 1987.

For more information or to Contact Cape Labour. You can find all of our relevant details here.

W.Tel no.: 021-423-3959
Cell: 082-433-8714
Fax: 021-4232105
E-mail: bernard@capelabour.co.za
Website: www.capelabour.co.za

The post South Africa’s new labour migration policy appeared first on Cape Labour live site.

What is a grievance?

A grievance refers to a complaint or any form of workplace discontentment or dissatisfaction that an employee may have with his employer, manager or fellow employee that needs to be addressed by the management of a company.

An employee is free to raise any grievance and will not be subject to victimisation. This process does not deal with issues related to compensation, unfair labour practices, demands for other benefits or as an appeal mechanism following a disciplinary hearing.

Steps to Filing a Grievance

The first step is to bring the grievance informally to your immediate supervisor, who has a certain amount of time to resolve the issue.

If the immediate supervisor cannot resolve the matter, the employee may take the complaint informally to someone above, such as a line manager. This can also be done formally by filing a grievance form, and the issue should be addressed within the applicable period.

If the above fails, the employee may escalate the issue to the HR department. The employee can complete a formal grievance letter or a Pro-forma grievance form and submit it to the HR department.

Once the complaint is lodged, the HR and employer have an applicable period to come up with a resolution with the employee. This time can be extended if the parties agree to it mutually, in writing.

It is important to include a time limit in each of the steps above to resolve the issue within a reasonable period.  All parties must, however, stay cognizant of the nature of the grievance and that time period cannot be seen as a “one size fits all” as certain grievances might require proper investigation and even counselling.

In terms of the formal hearing, management should appoint an impartial chairperson to chair the grievance hearing.

All relevant information is to be made available to the parties at the meeting for consideration.

All relevant witnesses (if applicable) that the parties may wish to call are to be available at the time of the meeting.

The employee and the company or their representatives have an opportunity to present their case fully and to ask questions of each other’s witnesses.

The chairperson, having heard the matter, shall make his / her findings and ensure that these are set out, in writing, within a reasonable period subsequent to the conclusion of the hearing.

If the formal grievance hearing remains unresolved, the employee has the right to declare a labour dispute at the CCMA or appropriate Bargaining Council.

The benefits of a grievance procedure are to promote sound labour relations, which are needed to increase productivity at work and ensure employee satisfaction.

CONTACT CAPE LABOUR.

For more information on labour law advice or services. Please feel free to contact us at Cape Labour Consultants and we will gladly assist you. Cape Labour & Industrial Consultants is a Cape Town-based providing Labour Law (Industrial Relations) and advice to employers and employees across all market segments and industries since 1987.

For more information or to Contact Cape Labour. You can find all of our relevant details here.

W.Tel no.: 021-423-3959
Cell: 082-433-8714
Fax: 021-4232105
E-mail: bernard@capelabour.co.za
Website: www.capelabour.co.za

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