Can You Withhold Remuneration Due To An Employee Who Gives 24H Notice

The Basic Conditions of Employment Act sets out minimum requirements to notice period(s) that must be adhered to by Employer and Employee.

The provisions are seven days if the employee worked less than six months, two weeks if the employee worked more than six months but less than a year and four weeks if the employee worked for more than a year. Employees who fall under Bargaining Councils or a Sectoral

Determination will also be held liable to serve out the applicable stipulated notice period in accordance with its collective or main agreement.

If an employee tenders a resignation with insufficient notice period the employer will not be permitted to deduct any monies for the notice period not worked by the Employee. The Employee will however be in breach of contract and the Employer will instead have recourse to hold the employee liable for the notice period not served

The Employer can therefore seek relief from the courts in this instance and sue the employee for damages or apply for specific performance required from the Employee.


Employee Status: Commission-only Employee

Some questions linger with regards to the legal employment status of an employee who is remunerated on a 100% commission basis, especially during the COVID-19 lockdown. The question of whether a commission-based employee is considered an employee is a prevalent one, especially in the South African employment environment where many employers try to circumvent he Labour Relations Act (LRA) in how they describe persons who perform services to their business. (Also read: “The Perpetual Independent Contractor,” 12 March 2020.)

According to Section 1 of the LRA, an employee is defined as:

Any person, excluding an independent contractor, who works for another person, or for the State, and who receives, or is entitled to receive, any remuneration, and any other person, who in any manner, assists in carrying on or conducting the business of an employer.

In addition, Section 83A of the Basic Conditions of Employment Act states that a person is presumed to be an employee of any other person to for whom they work or to whom they render services until the contrary is proven, regardless of the form of contract, if one of the following factors are present:

  • the way in which the person works is subject to the direction or control of another person
  • the person’s working hours are subject to the control or direction of another person
  • where a person works for a business or organisation, the person is a part of that business or organisation
  • the person has worked for another person an average of 40 hours per month for the preceding 3 months
  • the person is economically dependent on the person for whom they work or renders services
  • the person is provided with tools or equipment with which to perform the work or services by the other person
  • the person only works for or renders services to 1 (one) person,

These factors are referred to collectively as the “Section 83A Presumption.” This presumption is however not applicable to person who earn above the threshold of R205 433.30 per year, as per section 6(3) of the Basic Conditions of Employment Act.

A commission-only employee is a person who derives their entire income from the commission they earn on the work performed or services rendered to another person.

Commission-only employees typically have flexible working times and the way their work is performed, or services rendered may be left to the employee’s discretion and are not usually controlled by the employer.  The BCEA does not, however, set a required minimum time that an employee must work and only provides for limits on work time in terms of chapter 2 of the Basic Conditions of Employment Act.

Considering the application of the Section 83A Presumption, a commission-only employee will likely meet the basic requirements to be deemed an employee. Therefore, employers must ensure that commission-only employees are provided the minimum rights as per the Basic Conditions of Employment Act.

In terms of the COVID-19 lockdown, it is important to keep in mind that according to the National Minimum Wage Act (NMWA) of 2018, all commission based employees are legally entitled to receive at least the minimum wage and the commission payment in terms of their agreement with the employer. Section 3 of the NMWA provides that the laws relating to minimum wages apply to all employees and their employers.  This means that every employee is entitled to receive no less than the national minimum wage. The Act takes precedence over any contrary provision in any contract of employment and cannot be waived. Thus, commission-only employees are entitled to some form of income during this lockdown whether from mandatory paid annual leave or through the COVID-19 Temporary Employer/Employee Relief Scheme (TERS).


COVID-19: TERS Application for UIF benefits update

All employers are required to register for the TERS benefit by sending an e-mail to covid19ters@labour.gov.za, but employers with more than 10 employees as well as employers using a payroll system, will be required to complete the Memorandum of Agreement (MOA) which can be received through an auto reply to the email address covid19ters@labour.gov.za or as linked here.

These employers will receive a bulk payment from UIF and will be responsible for the distribution of the funds to its employees and provide an audit trail. Employers with 10 or less employees will not have to distribute the funds as employees will be paid directly by UIF.

If an Employer has less than 10 employees and/or no payroll system, they will not be required to complete the MOA and can follow the easy prescribed method.

All employers will receive an automated response from covid19ters@labour.gov.za and a number of compulsory documents will be provided.

Employers are encouraged to submit claims as soon as possible as it will take UIF some time to process the large number of expected claims. Any subsequent updated documents will supersede any outdated documents already submitted.

Employers should note that claims should be mailed to covid19claims@labour.gov.za.

Please note that employers who resort under a bargaining council, should confirm with such a council whether it has reached an agreement with UIF in respect of TERS benefits, in which case claims must be submitted through the relevant bargaining council in accordance with that particular agreement.

Employers are reminded to not claim UIF unless the situation is dire, or withhold funds from employees, as the UIF can issue an audit on your account at any time. If it is deemed that money has not been paid to employees or misappropriated employers will be held liable by the law.

List of required documents for TERS application (templates linked):

  1. Letter of Authority
  2. Memorandum of Agreement (MOA)
  3. Prescribed template that will require critical information from the Employer
  4. Confirmation of Employer details
  5. Evidence / payroll as proof of last three months employee(s) salary/ies
  6. Confirmation of Employer bank account details in the form of a certified latest bank statement.

References (linked):

(i)                Covid -19 TERS EASY AID GUIDE

(ii)               The body of the Auto Reply Email received from UIF