Employers: Important breaks for small businesses you need to know about

SME“…..we believe that the SME sector is critical in stimulating economic development, and that it is also a pivotal area in terms of innovation, skills development, entrepreneurship, labour-absorption and job-creation” (from a speech by the Deputy Minister of Small Business and Development)

(Note:  As always, be particularly careful to take specific advice on anything to do with our labour laws, they are complex and the penalties for non-compliance are severe.)

Last month we saw how only a defined “small business” can agree with employees that family responsibility leave days will count against their annual leave.  This month let’s look at the various other provisions of the Basic Conditions of Employment Act (BCEA) which apply only to small businesses.

Does the BCEA apply to all employers and employees?

Yes, except to members of the National Defence Force, National Intelligence Agency, South African Secret Service, unpaid volunteers working for a charity, and in a few other specialised situations.

Can you contract out of the BCEA?

No, the BCEA overrides anything less favourable to employees in an employment contract or other legislation, although some (not all) conditions can be varied by collective agreements and ministerial determinations.  That’s where the “Ministerial Determination 1: Small Business Sector” comes into play for SMEs.

Are you a “small business”?

In a nutshell, you will qualify as a “small business” if you employ less than 10 employees, provided you conduct only one business which is not formed by division or dissolution of an existing business. The determination doesn’t apply to domestic employees or to the public service, and a bargaining council agreement or another determination may take precedence.

Overtime

The normal restriction on overtime of 10 hours per week is extended to 15 hours per week.

The standard requirement to pay one and a half times normal wage for overtime is changed to one and a third for the first 10 hours of overtime, and one and a half times only for time over the 10 hours.

Averaging of hours

You can agree in writing with your employees that, for up to a year, their ordinary hours of work and overtime may be averaged (for example they could agree to work a number of extra hours this week in return for the same number of hours off next week) over a period of up to 4 months, up to a maximum average of 45 ordinary hours and 10 overtime hours a week.

Family responsibility leave

As we saw last month, you can agree in writing with your employees that their family responsibility leave days be deducted from their annual leave entitlement.

Ashersons Attorneys

Ashersons Attorneys

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