Contracts of employment are a legal requirement

Are your contracts, agreements, forms and documents all in order? In the course of our dealings with businesses, we have often come across instances where an employer has appointed staff without a proper letter of appointment or Employment Contract. Or they can’t find the employee’s written terms of employment when they are asked to produce them. The Basic Conditions of Employment Act states that an employer must provide all employees with the terms and conditions of their employment in writing. This document can be in the form of a letter of appointment, or it can be a more formal Contract of Employment. What is important is the content of this letter or employment contract, agreement or document. The contents also need to be explained to the newly-appointed employee to ensure that he or she understands what is expected. The Letter or Contract of Employment must, at a minimum, contain the following information:

• the full name and address of the employer;
• the name and occupation of the employee, or a brief description of the work for which the employee is employed;
• the place of work, and, where the employee is required or permitted to work at various places, an indication of this;
• the date on which the employment begins;
• the employee's ordinary hours of work and days of work;
• the employee's wage or the rate and method of calculating wages;
• the rate of pay for overtime work;
• any other cash payments that the employee is entitled to;
• any payment in kind that the employee is entitled to and the value of the payment in kind;
• how frequently remuneration will be paid;
• any deductions to be made from the employee's remuneration;
• the leave to which the employee is entitled;
• the period of notice required to terminate employment, or if employment is for a specified period, the date when employment is to terminate;
• a description of any council or sectoral determination that covers the employer's business;
• any period of employment with a previous employer that counts towards the employee's period of employment;
• a list of any other documents that form part of the contract of employment, indicating a place that is reasonably accessible to the employee where a copy of each may be obtained.

Getting the employee to sign a contract, agreement or appointment letter preferably at the commencement of employment, is strongly recommended as this can help to avoid disputes further down the line. If, however, the employee refuses to sign it, it doesn’t invalidate the employment relationship. The employment terms also need to be updated, in writing, when there are changes in the employee’s terms and conditions of employment, when the employee’s remuneration increases, or when there are changes in the employee’s benefits. You are also cautioned to ensure your filing and record-keeping processes are in order. Because the employment letter or written agreement of employment must be retained by the employer for a period of three years after the employee’s termination of employment. You can get your employment contracts, agreements, forms and documents here!  

Please note that this information is supplied for general information and does not constitute legal advice. It is advisable for you to contact a legal practitioner for guidance in respect of your unique requirements.