Labour law in South Africa, and more specifically the Basic Conditions of Employment Act, stipulates what “wage” means. Get your South African law questions answered by Experts. Usually, lawful pay cuts occur in two circumstances – when both employer and employee agree on it, or when the employer enforces it by law. Find out all about the labour laws concerning Overtime Working Hours in South Africa including overtime compensation, overtime pay policy, salary overtime law, working extra hours Complete our Salary Survey and Win a Wage! “If we end the lockdown too soon, we risk a resurgence of the disease.”. It is not compulsory in terms of the BCEA to work overtime; nevertheless, circumstances (such as operational requirements caused by load shedding) may warrant extension of working hours. An employer may require employees to start work later than usual and finish later than usual. The employee’s pay and/or responsibilities are reduced The employee’s subordinates are taken away The employee is required to report to someone who used to report to him/her. There have been suggestions that civil servants should take a 10% wage cut as part of plans to bail out the economy. It first asks, “Is there a legitimate reason or purpose for the processions?”, secondly “Is processing the information necessary for that purpose” and thirdly “Is the legitimate interest overridden by the interests of the data subject?”. Ramaphosa said that these members of the executive will all take a 33% pay cut over the next three months. It may be possible for the employer and employee to agree in the employment contract that payment or remuneration will be suspended during load shedding. The GDPR has established a three-pronged test in interpreting “legitimate interest” which considers purpose, necessity, and balance. In the circumstances clauses relating to the processing of personal information in employees’ contracts of employment which are aimed at securing employees’ consent to the processing, should at minimum set out the nature and scope of the personal information that is to be processed, the reason for the processing, consent to further processing, consent to collection from a source other than the employee and consent to the transfer of the information. Like many other countries worldwide, South Africa went into a 21-day national lockdown on 27 March, in an effort to help slow down the spread of the Coronavirus (COVID-19). The requirement that consent be voluntary, specific and informed means that there should not be any pressure or force placed on an employee to consent. It may well be that the Information Regulator interprets consent restrictively in keeping with the GDPR. ... South Africa Law. Another problem for employers during load shedding periods is dealing with what might otherwise be considered to be misconduct by their employees, such as late coming. So, for instance, late coming due to load shedding should be managed and employee’s counselled on how to work around the impact of load shedding on travel, traffic and daily life. Taxation may involve payments to a minimum of two different levels of government: central government through SARS or to local government. reduced working time) “owing to a shortage of work and/or materials and any other justifiable contingencies, including planned load shedding and/or unforeseen contingencies and/or circumstances beyond the control of the employer.”. Special personal information includes e.g. Written consent is not expressly required. Labour law protects workers against exploitation by employers and non-payment of wages. Planned load shedding is load shedding that occurs at a pre-determined and publicised time and date. Employers may not deduct money from a worker’s pay unless: The worker agrees in writing to the deduction of a debt The deduction is made in terms of a collective agreement, law (e.g. President Cyril Ramaphosa has announced that the deputy president, members of cabinet, and he, himself will all take a pay cut as part of a contribution to South Africa’s fight against the coronavirus. A 33% reduction works out to R134,000 a month (a cut of R66,000) – meaning for the three months, each minister will be contributing R198,000 to the fund. Labor laws, however, will remain the same. an employee’s race or ethnic origin, health or sex life, religious or philosophical beliefs and trade union membership. So as not to fall foul of the provisions of POPI it is recommended that employers develop internal policies that will assist them in determining whether in each instance, personal information to be processed is covered by the general consent clause in an employee’s contract of employment alternatively, by one of the other basis for lawful processing. Read: South Africa’s coronavirus lockdown extended by 2 weeks. So, what steps should be followed for cutbacks to be considered fair? It is crucial for employers to understand the meaning and interpretation of consent within the context of POPI. Both special and general personal information may be processed lawfully if the processing is necessary for the “establishment, exercise or defence of a right or obligation in law”. The duty to pay and the corresponding right to remuneration do not arise from the actual performance of the work, but from the tendering of service or productive capacity. Pay cuts can't be a retroactive surprise. Staff Writer 10 April 2020. South Africa– Blue Sky Publications (Pty) Ltd T/A TheSouthAfrican Number: 2005/028472/07. Our common and labour laws are clear – if the employer expects the employees to be at work at a specific time and on a specific day and the employees comply with these requirements, the employer is obliged to pay them for that time. Split over a year, a minister’s salary works out to just over R200,000 a month. In an effort to reduce the losses associated with this cessation of work during load shedding, some employers may wish to treat these stoppages as meal intervals. South Africa’s president and his cabinet will take a 33% pay cut for the next three months to contribute to a fund to help the nation cope with the novel coronavirus pandemic. Many employers are under the impression that when employees are unable to work due to load shedding the ‘no work, no pay’ principle applies. Employees are entitled to double pay (section 16 of the BCEA) for Sundays and Public Holidays. A determination is made as to whether there is a “legitimate interest” for the purposes of processing personal information based on the answers to these three questions. UIF contributions), court order or arbitration award. South Africa: Cost-cutting employment alternatives to retrenchment following the extended lockdown. The difficulty with this is that the employees will have to agree to such terms (or changes to their contracts of employment). All Rights Reserved. Remuneration cuts and deductions The Basic Conditions of Employment Act (BCEA) prohibits the deduction of an employee’s remuneration without the written consent of that employee. The announcement comes after  Ramaphosa extended South Africa’s national lockdown by another two weeks, beyond the original 21 days. When adjudicating the fairness of the dismissal or the severance pay dispute and provided certain other conditions were met (see s 74(2)(a) to (c) which has since been repealed effective 1 January 2019), the commissioner would hear any dispute regarding statutory money and if finding in favour of the employee included in their arbitration award, a finding that the employer pay … However, employers and employees can agree to changes in working hours or shift structures in order to reduce the financial losses caused by load shedding. Once there is a contract, the contract can only be altered when both parties agree. Employers have a grace period of one year as of 1 July 2020 within which to ensure their compliance with POPI. an employee’s race or ethnic origin, health or sex life, religious or philosophical beliefs and trade union membership. Section 1 of POPI defines consent as “any voluntary, specific and informed expression of will in terms of which permission if given for the processing of personal information”. While employers may hope for a “, The Information Regulator has yet to give guidance on the interpretation of consent in terms of POP. Therefore, where an employee offers to do the work and the employer does not want the employee to work or cannot provide the employee with work (due to load shedding or any other reason), the employer is still obliged to pay the employee his/her wages or salaries. Our common and labour laws are clear – if the employer expects the employees to be at work at a specific time and on a specific day and the employees comply with these requirements, the employer is obliged to pay them for that time. Employers will need to determine on a case by case basis whether the processing which they wish to conduct falls within the scope of the consent which they may have secured from an employee in his or her contract of employment or whether they will need to rely on one of the other basis set out in POPI. This would cover instances where e.g. Unfortunately, not all industries have an equivalent of the Agreement. In terms of section 7 of the Agreement, an employer may implement “short time” (i.e. An employer may implement short time, expecting load shedding to commence on a specific day and if the load shedding does not go ahead, the employer is left with minimal staff capacity. Many established South African companies have announced measures to prevent job losses as the coronavirus pandemic – and the national lockdown – strangles business operations. However, it will be for the employer in its capacity as responsible party to show that it has secured an employee’s consent where it is relying on consent. This will see healthcare efforts ramped up, along with financial packages for local businesses. The priority for the government is to ensure there is not a massive loss of life, while at the same time not allowing the economy to collapse. But, an employer may not unilaterally implement new working hours. Read Expatica’s guide for more information on how to get a South African work visa. It blamed the fact that many South Africans are indebted on the lack of economic reforms to create jobs, tackle poverty and ease inequality.“Instead, an Act is signed into law that puts South African’s savings, investment and access to credit at risk. Notably, the Agreement provides that “[w]here the employer does not implement short time in response to a planned or foreseen load shedding and the employees report for work but are sent home by the employer, they will be entitled to 8 hours payment in respect of such day.”. The Information Regulator has yet to give guidance on the interpretation of consent in terms of POP. My boss want to give me a pay cut of 40% is this legal - Answered by a verified Lawyer. This is regardless of whether the employees were able to perform their duties or not. Since January 2001, the tax system was changed to "residence-based" wherein taxpayers residing in South Africa … For example, where load shedding is planned for the beginning or end of a shift, the times of the shifts could be amended to ensure there is no loss of work time. If a South African company wants to employ a foreign national, they’ll need to secure a work permit. POPI distinguishes between the collection, storage and processing of personal information and special person information. In all likelihood it will have regard to the General Data Protection Regulation 2016/679 (GDPR) which requires that the consent is unambiguous and must be given by a clear affirmative act. If they have reduced your salary without you agreeing to, that is what is called a unilateral change of the terms of the agreement and would therefore be illegal and unenforcible. It is advisable that employers negotiate a plan to minimise its effect with employees. Of the two, the best-known route is to propose terminating the employment contract for operational reasons, using the procedure in section 189 of the Labour Relations Act. For those employers who do not fall within the scope of the Agreement the choices are not easy. Prior to 2001 the South African tax system was "source-based", wherein income is taxed in the country where it originates. Securing an employee’s consent is one of the basis on which an employer can lawfully process both general and special personal information of its employees. This may be hugely disruptive for employers and especially onerous on employers in the large metal and engineering industry who are subject to the Agreement. Unfortunately, most load shedding is unplanned with Eskom only announcing its implementation a few hours before it commences or changing it from Stage 1 to Stage 2 at some point during the load shedding period. “We are only at the beginning of a monumental struggle,” said Ramaphosa. If employees do not agree to changes in working hours, shift structures, pay or any similar measure designed to relieve the burden on employers during load shedding, the employer may be forced to implement retrenchment procedures in terms of sections 189 or 189A of the Labour Relations Act 66 of 1995 (as amended) (“LRA”). It is important that employers and employees be understanding of the serious implications load shedding has on both sides of the employment relationship and engage in meaningful consultation to ensure the least disruptive outcome is achieved. In another article, the author9considered South African case law (none of which specifically dealt with the application of s 84 in the circumstances of this case) and came to the conclusion that s 41(4) of the BCEA rewards the employer for offering … Accordingly, wage is the money payable or paid to an employee for ordinary hours of work, as agreed between employer and employee. Employers must be cautious not to contravene labour law requirements during these periods in an effort to reduce the consequences of load shedding. A pay cut cannot be enacted without the employee being notified. The Act further provides that an employer is obliged to pay the employee for those leave days, he said. 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