Important changes to BCEA impact employers

By Carla Koutroulis, Consilium Legal, Senior Associate. Big changes to the Basic Conditions of Employment Act (“BCEA”) provide protection to a broader employee base. From March 1, 2023, changes to BCEA created significant impact for South African employers. Firstly, the earnings threshold increased from R224,080.48 per year (R18,673 per month), to R241,110.59 per annum (R20,100 per month).

The earnings threshold dictates the employees that are protected by all provisions of the BCEA, and effectively, the increase results in more employees falling within that threshold and being protected by all provisions of the BCEA. Employees that earn in excess of the limit, are excluded from automatic protection of certain provisions, such as:

• Overtime
• Ordinary hours of work
• Meal intervals
• Rest periods
• Pay for Sunday, public holidays and night work.

Simply put, employees that earn less than the threshold are automatically entitled to overtime, Sunday, public holiday and night work pay, as well as the additional protections provided in the BCEA. This is not only an additional expense for employers, but is also an additional administrative consideration, in that employers must ensure that they have the relevant policies and procedures in place for the monitoring and approval of overtime hours worked.

Secondly, the amendments impact:

1. The deeming of fixed-term/temporary employees as permanent employees: Where employees earn under the threshold and have been employed in excess of three (3) months, they will be deemed to be permanent employees employed indefinitely.

2. TES (temporary employment service)/labour brokers: Employees that earn under the threshold and are not performing a temporary service are deemed to be employees of the client of the labour broker.

3. Unfair discrimination dispute: Employees earning under the threshold that have an unfair discrimination claim are permitted to approach the CCMA for relief; whereas those earning in excess of the threshold have to approach the Labour Court. This can have significant legal cost obligations for employers.

It is important for employers to be cognisant of the current BCEA threshold and its implications, as an increase in the threshold means more employees fall into the category of vulnerable employees and receive the benefits afforded as a result. The threshold remained static at R205,433.30 for a period of six years – from 2014 to 2021 – but has increased every year since 2021. It is likely that the legislature and Department of Labour is doing so in order to protect the vulnerable employees, particularly with the increase in cost of living; however, the financial impact on employers is substantial.

Having comprehensive policies in place that deal with the application of overtime for vulnerable employees is essential in order to safeguard the rights of the both the employer and the employee. Employees should not be able to elect to record or work overtime hours on their own accord. Rather, employees seeking to work overtime hours should first have to approach a line manager and advise them that overtime is needed in order to complete a task/project, justify the need for such overtime (i.e., prove that they were not able to do the work required during ordinary working hours), and have the overtime approved.

This will assist employers in managing any additional costs and prevent employees from taking advantage of the ability to earn overtime. It is recommended that employers perform regular reviews of remuneration and roles of the both permanent and temporary employees to determine any legislative implications and obligations.

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