Employment agreements are amongst the most important agreements a company will ever enter into.
There are two pieces of legislation that employers of large labour forces need to be familiar with, and which set out the basic entitlements of employees: The Basic Conditions of Employment Act (the BCEA) and the Labour Relations Act.
Most considerations listed below are regulated by these two Acts, particularly the BCEA.
Let’s explore five of the most important considerations when it comes to employment agreements.
1. Confidentiality & restraint of trade
Protecting the confidential information of your business is extremely important and you should secure customised provisions relevant to your business and industry to ensure that you are appropriately protected.
To protect confidential information and unlawful competition, include a confidentiality and restraint of trade clause in an employment agreement.
This seeks to prevent employees from using your confidential information for their own gain, or prevent them from working with certain of your customers, or in a competitive field of trade for a certain period and within a defined geographic area, after the employee leaves your company.
Related: Leave Form Template
2. Termination of employment
The BCEA sets out the following:
- If an employee is employed for four weeks or less, at least one weeks’ notice of resignation is required
- If an employee is employed for more than four weeks but less than one year, at least two weeks’ notice of resignation is required
- If an employee is employed for one year or more, at least four weeks’ notice of resignation is required.
For employees whose position in the company is crucial to its success, or requires a lot of expertise to fulfil, employment agreements may allow for three months’ notice.
3. Employee duties & responsibilities
This is real nuts and bolts stuff, and differs vastly from employee to employee — why did you employ this person? What do you expect them to do daily, monthly and annually?
These duties and responsibilities need to be recorded in an employment agreement so that both the employer and employee understand exactly what is expected of them and there is an agreed upon foundation for the relationship between the employee, the company and its structures.
4. Hours of work per week
The BCEA prescribes a maximum of 45 working hours per week for normal time work. Where an employee meets certain exemptions, this will not apply, and must be negotiated with the employee and included in the agreement.
The BCEA has set the maximum allowed overtime at ten hours weekly. Employees are generally entitled to meal and tea breaks, but these are not included in the 45 hour work week, and are generally unpaid.
Related: Discipline & termination procedure
The annual leave granted to an employee may not be less than 21 consecutive days for full-time workers, or by agreement, one day for every 17 days worked, or one hour for every 17 hours worked.
Annual leave must be granted not later than six months after completion of twelve months of employment, and must be on full pay.
During every sick leave cycle of 36 months, an employee is entitled to an amount of paid sick leave equal to the number of days he or she would normally work during a six week period. For example, should an employee work five days per week, they will be entitled to 30 days’ sick leave over a three year period, or ten days per year.
During the first six months of employment, however, an employee is entitled to a single day’s paid sick leave for every 26 days worked.
A female employee is entitled to at least four consecutive months’ maternity leave.
The maternity leave commences four weeks before the expected birth, or when a medical practitioner certifies it as being necessary for the health of the employee or unborn baby. An employee is not allowed to work for at least six weeks after the birth, unless a medical practitioner certifies that she is fit to do so.
Related: Making incentive programmes work for everyone
Protect your business and employees
Properly drafted employment agreements that protect your business and its assets are crucial in preventing costly litigation and CCMA hearings.
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