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Information on Contracts of Employment

Information extracted from the internet, not original of this website:

The contract of employment is the foundation of the relationship between an employee and his employer. The contract links the employer and the employee in an employment relationship. The existence of an employment relationship is the starting point for the application of all labour law rules: if there is no employment relationship between the parties, the rules of labour law do not apply to that relationship[1].

1.1 General requirements

The parties must enter into the contract freely and voluntarily. Forced labour is prohibited – in terms of section 48 of the BCEA no one can be compelled to work for another. Likewise, no employer can be compelled to take a particular person into service, and as all contracts in our law, parties cannot enter into illegal contracts of employment.

This last requirement is illustrated in Georgieva – Deyanova / Craighall Spar [2004] 9 BALR 1143 (CCMA) where an employer addressed a letter to the employee calling on her to furnish the required proof of legal documentation or a South African identity for her to work in South Africa. A further letter was also sent to the employee for her to provide proof with a deadline. On 1 July 2003, the employer informed the applicant that it could not employ her because of her failure to provide proof of her legal status. The employee approached the CCMA, claiming that she had been unfairly dismissed. In line with three other decisions, the commissioner found the CCMA did not have jurisdiction as the contract of employment was void ab initio (to be treated as invalid from the outset).

It is also necessary for the parties to be in agreement as to the nature of the contract. The employee might for instance believe that he is offered a contract of employment, whilst the employer believes that they are concluding an agency contract. Not only the nature of the contract is important – the parties must also be in agreement as to the contents of the contract.

1.2 Formalities

By common law no formalities are required when an employment contract is concluded. The contract of employment arises when the employee accepts them employer’s offer unconditionally. Although the common law does not require the contract to be in writing, section 29 of the Basic Conditions of Employment Act, requires an employer to supply the employee with written particulars of employment – this does not mean that a written contract is required, or that the contract is void. Certain contracts of employment must be in writing – this is required by other statutes. Examples are those of merchant seamen, learners under the Skills Development Act and candidate attorneys.

When the contract is concluded, the parties must agree on the work the employee is required to perform. The employee offers his/her services (labour potential) to the employer (either an individual or juristic person such as a company.) The employee is obliged to do the agreed work, as well as any unspecified task related to the main work, provided that it is not unlawful or beyond the area of expertise of the employee. This means that the employer can tell the employee what to do and how to do it.

The parties must agree on the remuneration to be paid to the employee at conclusion of the contract. Remuneration may be payable in cash and/or in kind (other benefits), and can take many forms, such as a monthly or weekly salary, weekly or daily wages, or even irregular payments.

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