Lesson 1, Topic 1
In Progress

4.1. The Importance of the Employment Contract

ryanrori January 11, 2021

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It is quite surprising just how many employers out there do not provide employment contracts.

They seem to have some wild dream that “if it is not in writing, then it does not exist,” or another dream is that “if there is no written contract, then we can do what we like with our employees.”

These are not dreams – these are nightmares – which are sure to land the employer in hot water at the CCMA.

Every employer is required by law (Basic Conditions of Employment Act – section 29) to provide the employee with a written contract of employment not later that the first day of commencement of employment.

Failure to do so could land the employer in jail for a term of imprisonment (section 93 of the BCEA) or to liability for a hefty fine (schedule 2 – BCEA)

A contract is usually entered into between two or more parties, in order to protect the parties to the contract against any breach or unlawful action in terms of the contract itself.

  • When you get married, you enter into a contract.
  • When you buy a house or car, you enter into a contract.
  • When you get divorced, you enter into a contract.
  • So then why not have a contract of employment with your employees?

The contract of employment is a vital document – it regulates the terms and conditions of employment between the employer and the employee.

It stipulates what the employer will provide in terms of benefits, and in terms of labour legislation, and it specifies what the employee is entitled to receive in terms of company policy, company benefits, and labour legislation.

It also regulates the behaviour of the employee in the workplace – because all company policies and procedures, as well as your disciplinary code, form a part of the employment contract.

If there is no contract regulating these matters, it is extremely difficult to take action against the employee – if there is no contract, or if the employee has never been informed, then he has the right to conclude that it does not exist.

They are various types of employment contract such as permanent employment, fixed term employment, probation employment, and project employment.

We will look at each one in turn.                                      

The contract of permanent employment

The first thing that happens is that an offer of permanent employment is given in writing to the prospective of the employee.

The prospective employee then accepts the offer of employment in writing.

The permanent contract of employment is then entered into.